World grain outturn forecast revised downward, corn production cut in Ukraine, US and EU

The forecast for world grain production in 2020 was cut by 25.0 mln t (0.9%) compared to the previous forecast in July, the FAO report reads. Notwithstanding this downturn in prospects, the expected global grain output still stands at 2 765 mln t, an all-time high and 58 mln t above the 2019 outturn.

This month’s production cutback results from a reduction in the world coarse grains forecast, now pegged at 1 496 mln t, down 23.5 mln t from the previous report in July.

"The bulk of the decline relates to a 26.3 mln t downward revision to the maize production forecast in the United States of America (USA), where plantings, albeit still up year-on-year, are lower than earlier expectations and recent storm damage in the Midwest caused crop losses and impaired yield prospects," analysts say.

It is noted that the overall yields are still expected to recover from the previous year’s low level and the US output is forecast at 380 mln t, 10% higher than in 2019.

Production forecasts were also lowered in the European Union (EU) and Ukraine, due to adverse weather that diminished yield prospects, and in Indonesia, where the historical production estimates, as well as the 2020 forecast, were revised downwards in line with recently released official statistics.

"These reductions more than offset upward revisions to the maize production forecasts in Argentina and Brazil, with both countries expecting record-high harvests. The forecast for global barley production in 2020 has been trimmed by 1.2 mln t, driven by lower yield prospects in the EU, and now stands at 154.2 mln t," FAO comments.

By contrast, world sorghum production is now expected to reach nearly 60 mln t, 6% higher than the previous year, following increased forecasts for India, Mexico and the USA.

Global wheat production has been reduced by 1.4 mln t since July, which puts this year’s output at 760.1 mln t, marginally below the good outturn of 2019. The recent decrease is mostly the result of cuts to production forecasts in Argentina, the EU and the USA by 1.3 mln, 4.0 mln, and 1.1 mln t, respectively, which outweighed upward revisions for Brazil, Canada, the Russian Federation, and Ukraine.

The Economy Ministry of Ukraine cut its projection for corn and sunflower production in Ukraine: the bulk yield of corn is expected at 33 mln t, sunflower at 14 mln t.