Global corn production is expected to fall by five percent in 2015/16 from this season's record level and the world wheat crop to decline by a more modest two percent, the International Grains Council (IGC) forecast on Thursday, February 26.

The forecast for worldtotal grains (wheat and coarse grains) production in 2014/15 is up by 4m t from the last report, to a record 2,006m, a slight gain y/y (year-on-year). All of the revision is absorbed by higher projected consumption, mainly in the feed and industrial use sectors, as demand is being stimulated by lower prices. The world carryover forecast is therefore little changed from before, at 431m t, a jump of 29m y/y and the largest since the mid-1980s. Following a 4m t m/m (month-onmonth) increase, to 304m, world grains trade (Jul/Jun) is expected to nearly match the all-time high during 2013/14.

The IGC raised its estimate for this year's wheatcrop by 2m t to 719m t, partly reflecting an upward revision to its forecast for Argentina to 13.9m t from a previous projection of 12.5m.

With crops mostly developing well, world wheat production in 2015/16 is forecast at 705m t, down by 2% y/y.

The Council's initial projection for 2015/16 maize(corn) output is for a 5% drop, to 938m t. Despite the drop in output, heavy stocks at the start of the season should ensure large overall availabilities. While strong demand is anticipated, especially for feed, maize ending stocks are likely to remain comfortable.

Global rice production in 2014/15 is forecast to decline marginally from the previous year's record, to 474m t. With consumption revised higher, world end-season inventories are cut to a five-year low of 101m t, the y/y contraction of about 8% reflecting heavy falls in the major exporters, namely Thailand and India. The projection of trade in 2015 is raised fractionally, but is still anticipated to be down by 2% from last year's record on smaller deliveries to Asia.

Due to improved prospects in South America, notably Argentina, the 2014/15 world soyabeanproduction forecast is lifted to a fresh peak of 315m t, up 11% y/y. With total use near-unchanged from before, global carryovers are raised to a high of 45m t, about 15m larger than in the previous season, tied to expected steep increases in key exporters. Traded volumes are projected to expand by 5%, to a record of 116m t, mostly on bigger deliveries to China.

The IGC Grains and Oilseeds Index (GOI) fell by 3% since the last report. Large world supplies continued to weigh on wheat and maize values, but soyabean quotations were underpinned by demand from China and mild concerns about harvest delays and logistical problems in Brazil.