The International Grains Council (IGC) today lowered its 2012-13 global corn crop estimate by 53 million metric tons (MMT) to 864 MMT. Fifty MMT of this cut was at the expense of the U.S. crop, which is now pegged at 300 MMT. IGC cited persistent dryness and scorching heat this growing season which has resulted in the worst U.S. drought since 1956. This would put global carryover stocks for corn at their lowest level in six years, while world demand is expected to rise 1% for the year.
IGC left its world wheat output forecast for 2012-13 unchanged at 665 MMT, which is 31 MMT below last year's tally. It did cite scaled back grain output and exportable surplus in the Black Sea region due to to unfavorable weather.
This contributed to a reduction in the Council's total grain harvest estimate to 1.810 billion metric tons, which represents a year-over-year decline as 2011-12 production is estimated at 1.846 billion metric tons. Global carryover grain stocks for 2012-13 are now pegged at 337 MMT, which represents a 29 MMT decline year-over-year.
Global soybean production, on the the other hand is expected to recover in 2012-13, rising 9% for the year, despite a 8.3 MMT reduction in U.S. production to 79 MMT. Increased production in South America is expected to more than make up for the decline in U.S. production.