Global grain production expected to drop by 40M tonnes largely driven by underperforming Wheat crop – IGC

UK— The International Grains Council (IGC) said as it convened its 56th IGC Council Session that global grain production is expected to fall by 40 million tonnes to 2.251 billion in 2022-23, reflecting smaller wheat, corn and sorghum harvests.

The poor outlook for wheat is tied to the war raging between Russia and Ukraine and is being exacerbated by unfavorable weather conditions causing crops to deteriorate in other major production territories such as India, the Americas and recently France, the largest cereal producer in the European Union.

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To manage the global wheat-supply crisis emanating from Russia’s invasion of Ukraine, The European Commission has proposed helping Ukraine get around a Russian blockade of Black Sea ports, with Bulgaria recently joining the effort.

Speaking in Brussels last week, Bulgaria’s Prime Minister said the assistance could be twofold, the export of physical grain from its own exportable surplus, and the shipment of Ukrainian grain via its Black Sea port of Varna.

To also ensure wheat security, the governments of Indonesia and Australia have agreed to intensify cooperation in the form of a memorandum of understanding (MoU) in the agricultural sector set to be implemented between the two states.

“It is important for us to strengthen food security. We discuss efforts to sustain the food supply chain, including that for wheat, in the midst of this very difficult world situation,” Indonesia’s President Joko Widodo stated.

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The IGC expects Global end-season inventories to contract owing to lower consumption and World trade is anticipated to drop 3% to 404 million tonnes, reflecting an anticipated drop in corn and barley volumes.

Global soybean production, however, is expected to rebound, increasing 11% year-over-year to a peak of 378 million tonnes. Traded volumes are expected to increase 8% on larger deliveries to Asian markets in particular, the IGC said.

Tied to gains in Asia, world rice output was seen expanding by 1%, to a fresh high. World pulses import demand was forecast to contract by 2% in 2022 as bigger shipments to Far East Asia were expected to be outweighed by smaller deliveries elsewhere, including to the EU, Africa and the Americas.

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