World Wheat Crop Outlook Worsens, While U.S. Cornbelt Burns Up
July 10, 2012 • 7:37AM

More food crop damage is reported in the latest world survey reports on the prospects for major grains. On July 2, the International Grains Council, based in London (representing participating governments), dropped its estimate for annual world wheat output, to 665 million metric tons, down from a hoped-for 671 mmt, and way below the prior season's 695 mmt.

The Eurasian Wheatbelt faces a lowered harvest. The crop in Russia, Ukraine, and Kazakstan has been hit by a sequence of bad weather: winterkill freeze, a Spring drought, then heavy rainfall. The Russian Agriculture Ministry reported that, as of the end of June, Russia's harvest is now forecast for 46-to-49 million metric tons, down from 57 mmt expected earlier, and last season's 56.2 mmt. Accordingly, its wheat-for-export is down to 16-18 mmt, down from a hoped-for 20 mmt. (Last year, exports reached 28 mmt).

The Grains Council, for this year's world corn harvest, stuck to a rosy estimate of 917 mmt — which would be a record — though double this volume is needed; but it included 350 mmt of this total to come from the United States, per its usual 35-40% share of world output. The IGC added as a disclaimer: "However, the risks are on the downside unless U.S. weather prospects improve."

In fact, in the 7 days since the IGC issued its report, the U.S. Cornbelt weather has been a furnace. The yield losses are terrible. One Midwesterner summed it up, "We are farming in hell."