Global wheat stocks sharply revised upward

The Wasde report does not have much impact on the grain market. It is notable, though, that the USDA has sharply raised the ending stocks of wheat. In Argentina, the old record for the corn harvest is being smashed. That is what the Rosario exchange reports in the new yield estimate at least. American traders are taking the gamble that the rain forecast for next weekend will actually materialize in the southern wheat belt. However, the drought monitor shows a somewhat less optimistic picture.The May contract for wheat on the Matif closed yesterday €2.25 lower at €195.50 per tonne. On the CBoT wheat lost 5¾ cent to $5.74½ per bushel. Corn also took a step back with a loss of 3¼ cent to $4.44 per bushel. Soybeans closed in the green with a gain of 3¼ cent to $11.65¼ per bushel.The Wasde report published yesterday evening European time by the USDA did not contain any very shocking changes. Perhaps the most striking is the increase in the global ending stocks of wheat in season 2025/26 by 6.2 million tonnes to 283.1 million tonnes. This puts ending stocks 24 million tonnes, or 9%, higher than a season earlier. Global wheat production for 2025/26 has been raised by 2 million tonnes to 844.2 million tonnes. That adjustment is mainly due to higher wheat production in the EU and Russia. Consumption has been lowered by 4.7 million tonnes to 820.1 million tonnes. This revision is largely due to India. Data from the Indian government shows that stocks in that country are larger and that implies according to the USDA that less wheat was consumed on the subcontinent.The global ending stock of corn for season 2025/26 has been raised by 2 million tonnes to 294.8 million tonnes. That is fairly in line with what the trade expected in the Reuters survey earlier this week. The USDA has made no adjustments this month to the corn harvest in South America. The harvest estimate for South Africa has been raised by 800,000 tonnes to 17.3 million tonnes. For soybeans the Wasde report is neutral to somewhat bullish in tone. The global ending stock has been lowered by 500,000 tonnes to 124.8 million tonnes. The harvest estimates for Brazil and Argentina remain unchanged. Somewhat strikingly, the USDA has made no adjustments to soybean oil consumption in biofuel. The first figures for the 2026/27 season will come in the May edition of the Wasde report.Record harvest in Argentina The grain exchange of Rosario has sharply raised the harvest forecast for corn in Argentina from 62 million tonnes to 67 million tonnes. If this yield is actually achieved, that would significantly surpass the previous record. The best harvest to date for Argentina was 52.5 million tonnes in season 2023/24. According to the exchange, the reason the harvest is turning out so much larger than in the previous estimate is that Argentine farmers sowed far more hectares than previously expected. The area is 420,000 hectares larger and thus reaches 10.2 million hectares.The larger corn area comes largely at the expense of soybeans. The soybean area is 200,000 hectares lower at 16.2 million hectares. Somewhat surprisingly, the Rosario exchange keeps the yield forecast for soybeans unchanged compared with the previous estimate, at 48 million tonnes.Unclear agreements Meanwhile, unrest in the Middle East continues to set the tone mainly in the oil market. The ceasefire between Iran, the US and Israel is fragile and the countries are disputing what exactly has been agreed. In any case, the Strait of Hormuz has not been fully opened. Various sources report that Iran is only allowing fifteen ships per day through. Before the war, that number was well above one hundred. Access would also only be granted to ships from friendly countries. Ships with a link to Israel and the US are not allowed through.This is also reflected in fuel prices at the pump. The region also supplies a lot of fertilizer, which has become much more expensive because of the war. India, which imports large quantities of fertilizer from the Middle East, has announced measures to protect farmers against high prices. The country has set up a subsidy program to keep fertilizer affordable for farmers. For various fertilizers the country has set maximum selling prices. The program involves 415 billion Indian rupees (about €3.83 billion). Drought spreads in the US In the US, rain is forecast for the prairies for the weekend. Of course, that is not yet visible in this week’s drought monitor. The area of winter wheat that is in a drought area has expanded by 3% compared with last week. In total, 68% of winter wheat is now in a drought area. In the southeastern US, little rain is forecast and that is favorable for sowing, among other things, corn and cotton in the area.