IGC Revises 2008/09 World Grain Output Down Slightly

The International Grains Council Thursday said that world 2008/09 grain output would total 1.769 billion tonnes, 1 million tonnes lower than forecast last month. This still however represents an increase of 80 million tonnes on 2007/08. World consumption is pegged at 1.745 billion tonnes.

This month's slight reduction comes on the back of lower wheat output from Australia and Argentina.

Global ending stocks are pegged at 307 million tonnes, an increase on 2007/08's 283 million, but still rather tight. That equates to two months supply by my calculations. Any potential crop losses here and there due to weather problems and things could get quite hairy.

Interestingly, despite the economic downturn, the also predict world meat consumption up by 2%, which will also keep stocks tight.