LONDON (Commodity Online) : Adverse weather conditions in major wheat producing regions prompted International Grains Council to trim estimates by 13 million tones this year.
According to its latest report, the IGC also trimmed its forecast for world corn production, lowering its forecast for inventories of the grain to a four-year low.
The intergovernmental group slashed the forecasts based on extreme heat conditions in major producing regions like Canada, Europe and Black Sea.
The cut in the world wheat crop estimate, to 651m tonnes, in 2010-11 reflected the prolonged period of dry weather and high temperatures which had significantly reduced yield prospects in Russia, Kazakhstan, parts of Ukraine and north western areas of the European Union, it said
Wet weather and flooding were detrimental for crops in Canada and parts of south eastern Europe, the group added.
Wheat exports from Russia, struck by its worst drought in 130 years, were now on track to fall to 15.3m tonnes, 2.7m tonnes below previous forecasts, if well above the estimates of some other analysts.
The decline would be offset by a major increase in US exports, in particular, the IGC added, raising its estimate for US shipments by 1.9m tonnes to 26.0m tonnes.
The IGC attributed the 1m-tonne reduction to its corn production forecast to a worse prospects for EU and US crops, in part offset by an improved outlook for crops in China, Indonesia and Ukraine.
Nonetheless, the harvest would fall short of demand for a second successive year, the IGC said, lowering its forecast for stocks at the end of 2010-11 to a four-year low of 134m tonnes.
The forecast for stocks in the US, the world's top corn producer, was lowered to reflect greater-than-anticipated domestic use and a reduced 2010 crop estimate.