The U.S. Department of Agriculture's latest World Markets and Trade Report reveals significant adjustments in global grain production and trade forecasts for 2024/25, impacting key markets like wheat, rice, corn and sorghum.
Wheat production and prices
Global wheat production for 2024/25 has been revised lower, with significant reductions for the European Union, Russia, India, and Brazil. However, global production remains at record levels, while consumption forecasts were trimmed slightly but still expected to hit a new high. The U.S. season-average farm price for wheat remains steady at $5.70 per bushel, but domestic prices for all wheat classes rose in response to tighter global supplies. Hard Red Winter wheat increased by $7/ton to $277, while Soft Red Winter saw a notable $24/ton jump to $266, driven by large sales and shipments to the Western Hemisphere. Global wheat prices also firmed, with the EU and Russian quotes jumping $14/ton on concerns over winter wheat planting in the Northern Hemisphere due to drought conditions in Russia.
Rice market adjusts after India's ban lift
India’s decision to lift its 14-month export ban on non-basmati white rice has prompted a substantial shift in the global rice market. The removal of the ban and the implementation of a Minimum Export Price (MEP) of $490/ton are expected to lead to increased global exports, while prices have started to decline. Global rice production is forecast higher for 2024/25, thanks to an increase in India’s output, which offsets reductions in other countries like the Philippines. Global rice consumption is expected to rise, with higher demand from Africa and Asia. U.S. rice prices, however, saw a rise of $11/ton to $750, driven by improved demand within the Western Hemisphere.
Corn and sorghum forecasts
Global corn production for 2024/25 is forecasted to decrease, mainly due to reductions in Egypt, Russia, Ukraine, and the Philippines, despite an increase in India’s production. Global corn trade is also expected to decline, with lower exports from Argentina, Brazil, and Russia. The U.S. corn season-average farm price remains at $4.10 per bushel, with export bids up by $6/ton to $211, reflecting smaller supply expectations.
U.S. sorghum exports saw a rebound in 2023/24, doubling to 6.1 million tons, primarily due to stronger production after a drought-affected previous year. China remains the largest destination for U.S. sorghum, using it for animal feed and the production of baijiu, a traditional beverage. However, U.S. sorghum production is forecasted to decline to 7.7 million tons in 2024/25 due to unfavorable weather conditions, which is expected to reduce exports to 5.2 million tons. Argentina and Australia are forecasted to grow their shares of global sorghum trade in the upcoming season.
These adjustments reflect a dynamic global grain market, with shifting trade policies and weather conditions influencing production and prices across key commodities.
