World: World grain prices declined in August and have not recovered since
In July/early August, adverse weather conditions and crop concerns had created a bullish sentiment in grain and oilseed markets, but on the 10th of August the USDA crop forecast turned the market upside down. All U.S. and world estimates of crops and end stocks were higher than expected by the market, H. M. Gauger GmbH said in their latest report published early in September.
The USDA estimate always has a strong and immediate effect on markets; prices started a steep decline and have not recovered since. Improved weather in North America and reports of stupendous grain crops in Russia and Ukraine aggravated the market pressure.
At the end of August a sober IGC report showed improved crop figures from the July estimates, with much higher numbers of the East European crops. However, crops are smaller than last year, and carry-over stocks of all grains at the end of the crop year 2017/18 will drop by 40 mln tonnes. Markets will not be impressed much, as the stocks – 485 mln tonnes - will still be very comfortable. Also stocks of the major oilseeds are forecast to remain at a safe level of 111 mln tonnes, but it is a remarkable that consumption rose by almost 9 % (44 mln tonnes) in two years’ time.
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