World corn stocks will shrink to their lowest for four years – and far faster than previously thought – sapped by the deteriorating prospects for crops in China and the US, the International Grains Council said.

The influential intergovernmental group, in a report which also trimmed expectations for wheat inventories, cut its forecast for global corn stocks in 2010-11 to 125m tonnes, the lowest since 2006-07.

The revision put world corn inventories on course for a 27m-tonne reduction during the year, more than twice the fall estimated last month.

It also left the IGC's outlook considerably more gloomy than that of the US Department of Agriculture which, in a flagship report earlier this month, pegged global stocks ending the season at 132.4m tonnes, and estimated the decline in inventories over the year at 16.6m tonnes.

China setback 

The IGC's downgrade reflected in part the American inventory adjustment highlighted by the USDA briefing, after farmers, who have enjoyed an unusually timely harvest, dug heavily into new crop supplies to replace lower-quality crop from last year.

The estimate for the Chinese crop, which has been dogged by unfavourable weather, was cut by 3m tonnes to 162m tonnes, with hopes for the US slashed by 11m tonnes to 334m tonnes.

The revision to hopes for China comes amid a charged debate over prospects for the crop with the government sticking by an estimate of a record 169m-tonne crop, while private analysts are, for a second year, far more gloomy than official forecasters.

'Corn remains competitive' 

A further squeeze on stocks will come from raised hopes for consumption.

The estimate for wheat inventories at the close of 2010-11 was trimmed by 2m tonnes to 181m tonnes, also reflecting higher demand hopes.