The International Grain Council (IGC) has lowered its projection of 2012-13 total global grains carryover by 4 MMT from last month to 328 MMT, which compares to 372 MMT last season. The group trimmed global wheat carryover by 3 MMT to 172 MMT (196 MMT last season) and trimmed global corn carryover by 1 MMT to 117 MMT (135 MMT last season). IGC raised its global soybean carryover projection by 5 MMT to 27 MMT, which compares to 24 MMT last season.
Regarding prices, IGC says: "Against a still uncertain macroeconomic backdrop, grains have remained supported by a tight fundamental outlook. The IGC Grains and Oilseeds Index (GOI) is down by 2% month over month (m/m), but this largely reflects a 5% m/m decline in soybeans, driven by fund liquidation as crop prospects improved. The maize and wheat sub-indices rose by 4% and 1%, respectively, while rice was broadly unchanged."
Regarding the global wheat crop, IGC says lower yields in the EU and Kazakhstan, as well as deteriorating crop prospects in Argentina and Australia, resulted in a 2 MMT reduction in the forecast for world production to 655 MMT. For corn, IGC says while global demand has eroded, a 3 MMT reduction in the size of the world crop to 830 MMT led to a tightening in carryover.