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IGC ups 2014 wheat crop hopes - but warns on frost

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The International Grains Council lifted its hopes for world wheat production this year, noting benign conditions in many countries, but cautioned that low levels of snow cover in many areas meant an enhanced threat of winterkill.

The intergovernmental group, which last month forecast a global wheat crop of about 686m tonnes in 2014-15, raised its estimate to 697m tonnes.

That crop would rank second only to that this season's "exceptional" 707m tonnes - and indeed come from increased plantings, with the next harvest expected to cover an area of 224.2m hectares, up 2.5% year on year.

"Despite the increase in area, total wheat production is tentatively expected to decline," the IGC said.

"Yields are likely to return to more average levels following some outstanding results this season."

'Generally favourable conditions'

Nonetheless, the forecast implies a higher yield hopes than expected last month, when the group forecast harvested area at 224.9m hectares.

"Winter wheat planting for the 2014-15 crop year has been completed in the northern hemisphere under generally favourable weather conditions," the council said.

In the European Union, the biggest producer, "unseasonably warm weather with showers has provided generally favourable conditions for dormant winter crops", while in India "abundant monsoon rains" have underpinned prospects.

In North Africa, "prospects for winter grains remain favourable, with drier conditions allowing remaining fieldwork to finish," the council said.

"The soil moisture in most regions is regarded as adequate, except for southern parts of Morocco, which require more precipitation."

'Vulnerable to frost risk'

However, the IGC also cautioned over the threat that a freeze could yet pose to crops in areas such as the European Union and former Soviet Union, where warm weather has melted snow.

"Limited snow cover has left the crop vulnerable to frost risk in some regions."

In the EU, "major winter wheat areas" lacked snow cover, "potentially increasing the risk of frost damage, notably in Finland, Sweden, the Baltic States and Poland".

The comments follow a report from the European Commission warning that warm weather had delayed "hardening" in winter grains, the process in which they develop tolerance to low temperatures.

"A decrease in frost tolerance has been observed in southern France, Hungary, Serbia, Bulgaria and some other areas of the Balkan Peninsula where a large part of the crops is only slightly hardened," the briefing said.

"Little or no low-temperature tolerance has been reached in the coastal region of the Mediterranean Sea."

Improved supplies

The IGC's comments came in details of a report in which it raised by 9m tonnes, to 707m tonnes, its estimate of world wheat production in 2013-14, reflecting upgrades to Australian, Canadian, Chinese and former Soviet Union harvests.

The forecast for world stocks at the close of the season was raised by 7m tonnes to 188m tonnes, representing a rise of 9% year on year.

Signally, the forecast for stocks in major exporting countries, a figure to which prices are particularly sensitive, was upgraded by 5m tonnes to 56m tonnes, a 17% rise year on year.

By Agrimoney.com

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