Grain: World Markets and Trade, May 2006

Grain: World Markets and Trade
Foreign Agricultural Service Circular Series
FG 05-06
May 2006

World grain supplies (coarse grain and wheat) are expected be much tighter in 2006/07, boosting global grain prices. Rising consumption is expected to outstrip production for the second straight year, which would push world grain ending stocks to the lowest levels in more than 25 years.

Global tightness in corn is primarily due to expected supply and demand changes in the United States. Lower production, coupled with strong domestic demand for ethanol, will likely shrink ending stocks and raise U.S. corn prices. For wheat, global production is expected to be down largely due to poor crops in the Black Sea region, reducing their exportable supply and likely resulting in higher world soft wheat prices. U.S. production is also expected to see a sharp reduction, cutting ending stocks to a decade-low level and boosting U.S. hard wheat prices. These wheat supply shortfalls, however, will be partially offset by large stocks and expected good crops in other key exporters such as Argentina, Australia, Canada, and the European Union.

CIRCULAR MODIFICATIONS: The following changes have been incorporated into this May 2006 Circular:

Wheat Commentary	[Text]	[Adobe Acrobat Format]
Wheat Data Tables	[Excel Spreadsheet Format]	[Adobe Acrobat Format]

Rice Commentary	[Text]	[Adobe Acrobat Format]
Rice Data Tables	[Excel Spreadsheet Format]	[Adobe Acrobat Format]

Coarse Grains Commentary	[Text]	[Adobe Acrobat Format]
Coarse Grains Data Tables	Excel Spreadsheet Format]	[Adobe Acrobat Format]