The latest edition of the AMIS market monitor, released on September 8, shows that the international price of wheat, maize, rice, and soybean has decreased since July. This decline has been driven by improved global crop prospects and plentiful export availabilities.
Wheat production is expected to reach an all-time high of 741 million metric tons in 2016-2017, up 9 million tons from July. This increase has largely been driven by favorable weather conditions in the main producing countries; very good growing conditions have been specifically reported in the US, Russia, Kazakhstan, and India. Wheat trade estimates were also scaled up significantly, by 7 million tons, due to low prices boosting imports, especially in Asia and Africa. End-of-year stocks were also revised up significantly by 16 million tons to 233 million tons.
Maize production estimates rose sharply to 1030 million tons, mainly driven by exceptional yield expectations in the US. However, maize prospects for China, Brazil, and Canada were lowered due to poor weather conditions in these countries. Overall, global maize prices remained relatively stable, while maize trade and stocks estimates rose moderately by 3 and 10 million tons, respectively.
Rice production estimates were scaled up due to improved weather in Asia and less attractive prices for alternative crops. Rice exports dropped by around 4 percent over the past month due to these production increases. Rice growing conditions have generally improved in recent months thanks to good rainfall in South and Southeast Asia; however, concerns remain over the wet season in Thailand, Vietnam, and China. In China, conditions are generally below average due to high temperatures in the lower Yangtze and heavy rainfall in the south. Rice trade and stock estimates were virtually unchanged at 43.7 and 166 million tons, respectively.
Favorable weather in the US and a near record crop in Argentina boosted global soybean production to 326 million tons for the year. This has supported a drop in soybean export prices by around 5 percent. Soybean trade was relatively unchanged, with increases in US exports cancelled out by decreases from other exporters, notably Brazil. The increase in global production has increased stock estimates to 36 million which, however, remains significantly below last year’s record.
The next AMIS market monitor will be released on October 6.