The International Grain Council (IGC) has raised its projection for 2011-12 global grain stocks by 9 million metric tons (MMT) from last month to 378 MMT -- now up from 373 MMT in 2010-11. USDA raised its global wheat stocks projection by 7 MMT from last month to 211 MMT (196 MMT last year) and raised its global corn stocks projection by 1 MMT from last month to 126 MMT, which is still down from 133 MMT last year.
IGC says it raised its global total grains production estimate by 11 MMT to 1.841 MMT, largely because of larger crops in Australia, Kazakhstan, Ukraine, India and Brazil. It says it expects Brazil's safrinha crop to make up for the losses of its regular season crop.
Regarding the corn crop, IGC says while the U.S. crop was disappointing, it was still slightly above average, and bumper harvests were collected in China, Ukraine and the EU. "A severe drought has reduced yield prospects in South America, especially in Argentina, but Brazil remains on track to produce a record crop. Improved supplies in some countries are boosting consumption, with overall use forecast at a record high. Feed use of maize is expected to increase at a faster than average pace but, with U.S. ethanol production likely to decline slightly, the rise in industrial demand will be below trend. With demand outpacing the increase in supplies, ending stocks are forecast to tighten further, including in the U.S. Amid solid buying by a number of importers, world trade is forecast to rise to a four-year high," it states.