Canada and the European Union joined countries facing a
disappointing corn harvest after heat and drought cut yield prospects, as already
highlighted in Ukraine and the US.
The US Department of Agriculture cut by 1.1m tonnes to 11.7m
tonnes its forecast for the Canadian corn harvest, noting reports that in some
regions "hot and dry conditions in July stressed the crop, resulting in poor
The downgrade implies a rise of less than 8% in Canada's
corn production, despite a rise in sowings of nearly twice as much.
The USDA also sliced by 4.4m tonnes to 57.1m tonnes its
forecast for the EU crop - the world's fourth biggest after US, Chinese and
Brazilian harvests – also citing "summer heat and drought damage".
"Yield potential has been falling rapidly in the EU since
July when extremely high temperatures inhibited pollination and drought limited
kernel growth in much of the EU's corn belt," the USDA said, following a crop
tour to some eastern growing countries.
"The primary corn-growing areas have all struggled from
excessive heat and moisture stress this season," dashing expectations of a "bumper
crop" which appeared likely earlier in the season.
In Hungary, "much of which has seen no significant rainfall
since July", production is seen falling 38% year on year to 5.0m tonnes.
The French crop, the EU's biggest, was downgraded by 1.0m
tonnes to 15.5m tonnes, putting a decline from last year's result on the cards.
The fresh estimate for the overall EU harvest implied a
12.6% drop from last year's strong result, which enabled the bloc to achieve exports
of 3.2m tonnes in 2011-12, the highest in 40 years.
Indeed, the USDA cut to a seven-year low of 500,000 tonnes
its forecast for EU corn shipments in 2012-13.