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Aug 27, 2021

IGC Reduces Wheat Outlook

Hot, dry weather has negatively affected crops in several parts of Northern Hemisphere

CONAB Updates Brazil’s 2021/22 Crop Outlook

  • The agency sees a record grain harvest coming for the 2021/22 crop year with a production outlook at 290 million tonnes.

  • The bean crop is seen at 141 million tonnes, which would be up 3.9% from last year's crop.

  • Bean planted area is expected at 99 million acres, an increase of 3.6%.

  • This compares to the USDA’s August forecast of 144 million tonnes for the coming season.

  • The corn crop is projected to rise 33.8% to 116 million tonnes after the poor performing winter corn crop.

  • Corn area is seen expanding to 51 million acres, up 3.9% from the previous year; winter corn area is seen rising 5%.

  • The latest USDA forecast is for a slightly larger corn crop of 118 million tonnes in 2021/22.

FBN’s Take On What It Means: CONAB, Brazil’s equivalent of the USDA, is expecting record soybean production and a rebound for corn production following a light winter corn harvest, which is just wrapping up. Soybean planting begins soon with summer corn plantings already underway, and the increase in acreage is expected as Brazil continues to expand production to meet global demand, especially from China.


IGC Reduces Wheat Outlook

  • The International Grains Council cut its forecast for the 2021/22 world wheat crop by 6 million tonnes to 782 million tonnes.

  • The change reflects lower projections for Russia, Canada and the United States.

  • Russia's wheat crop was seen at 75 million tonnes, down from a previous forecast of 81 million tonnes, but above USDA’s projection of 72.5 million.

  • IGC reduced its wheat crop forecast for Canada to 24.5 million tonnes from 28.5 million tonnes.

  • The agency also trimmed its outlook for the US to 46.2 million tonnes from 47.5 million tonnes in line with the current USDA forecast.

  • Upward revisions for Ukraine to 32 million tonnes from 29.5 million and Australia to 30.1 million tonnes from 28.9 million partially offset

FBN’s Take On What It Means: Hot and dry weather this summer has negatively affected crops in several parts of the Northern Hemisphere. The trade awaits the Stats Canada crop report on Monday for further ideas on the magnitude of losses there. We expect continued underlying support as the market reallocates the lower supplies expected in North America, and Russia along with the quality issues in the EU.

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Kevin McNew

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Marketwatch: Dec, 03

cmdty National Corn Price Idx: ZCPAUS.CM

open: 5.6309
high: 5.6797
low: 5.6159
close: 5.6309

cmdty National Soybean Price Idx: ZSPAUS.CM

open: 11.9852
high: 12.1581
low: 11.9477
close: 12.111

cmdty National Hard Red Winter Wheat Price Idx: KEPAUS.CM

open: 8.119
high: 8.2535
low: 8.054
close: 8.2002

cmdty National Soft Red Winter Wheat Price Idx: ZWPAUS.CM

open: 7.5939
high: 7.7096
low: 7.5239
close: 7.6525