The Council lowered its forecast for global commodity stocks of corn by 5 million tonnes to 203 million tonnes at the end of the 2017-18 year, bringing the figure was the lowest since the end of the 2013-14 year and 32 million tons less than last year.

The inventory forecast was reduced, despite the fact that the forecast for world corn production this season was increased by 5 million tons to 1,034 billion tons of crop, which is second only to the volume of 1,079 billion tonnes harvested last season.

However, the growth of the production estimates is mainly related to the United States where estimates of yield during the harvesting campaign continues to grow, — was surpassed by the increase in expected demand.

"Growth in industrial use"

Indeed, the IGC raised its forecast for global consumption of corn in 2017-18 city of 9 million tons to 1,067 billion tonnes, 13 million tonnes more than the record figure of last season.

The Council noted "the projected growth in industrial use of corn, mostly in China, where government measures to stimulate demand and reduce our inventory."

Indeed, Beijing has canceled a program of guaranteed maize prices to limit further growth of the already bloated state reserves, at the same time initiating measures to increase demand, including planned deployment of a nationwide programme of E10 by 2020, which means the proportion of ethanol in the fuel used at the level of 10%.

This program implies a significant increase in demand for ethanol from current levels, as the report of the Ministry of agriculture of the USA evaluated the use of ethanol as fuel in China in 2017 3.55 billion litres, which corresponds to 2.2% of projected the 162.8 billion litres of fuel consumed.

The report also stated that 70% of bioethanol is made from maize, 25% cassava and 5% of molasses.

"The first reduction in stocks in five years"

While IGS has made only minor adjustments in the global balance of wheat, global corn stocks at the end of the 2017-18 year was reduced by 4 million tonnes to 493 million, And this will be the first reduction in stocks in five years.

However, while the reduced estimate of reserves is usually associated with rising prices, the forecast for grain stocks stored in the major exporting Nations figure, which have the greatest influence on prices – has been increased by 3 million tonnes to 172 million tonnes. This will mean a reduction of 7 million tons compared to last year.

Photo: yablukom.com.ua