A potential landmark for U.S. soy, alongside Black Sea production records and an uncertain EU growing season are analyzed in the latest global crop outlook report from our Lanworth agriculture research team.
- Soy plantings may surpass U.S. corn for first time since 1983, with prices and lower production costs making it a more profitable crop for farmers.
- Black Sea farmers have continued to break production records, with Russia now the world’s largest wheat exporter.
- Global crop outlook report by our Agricultural Research (Lanworth) team on Eikon provides a comprehensive insight on industry developments.
The IGC Grains and Oilseed Index (GOI), a daily trade-weighted measure of international price movements, shows that average values have increased by around 12 percent since January.
The essentials of the global trade outlook for corn, wheat, rapeseed and soy have been captured in the latest report by Agricultural Research (Lanworth).
This comprehensive insight available on Eikon will help to comprehend future crop flows, output and pricing, as well as the impact of weather, supply chain disruptions and geopolitical events.
In this piece, we look at the outlook for crop production in the Black Sea, the European Union and the United States for summer 2018.
United States crop production
U.S. corn and soy production has given us back-to-back record seasons, and so far, the outlook is for things to stay strong, especially for soybeans as they continue to gain acreage on corn and other crops.
Stable economic and weather conditions have our current U.S. corn and soy production outlooks at 14.3 (13.6 – 15.0) and 4.31 (4.10 – 4.60) billion bushels respectively.
Gain valuable insight into the world’s agriculture markets with Eikon Commodities – Agriculture
We expect corn and soy plantings to hover around 90.4 and 90.1 million acres, 2.7 percent and 1 percent above the current estimate of 88 and 89.9 million acres released in the U.S. Department of Agriculture’s (USDA) March Prospective Plantings Report.
As last year, rebounding soy prices and lower production costs make soy a more profitable crop for farmers, which is pushing for another year where “King Corn” is brought down another notch.
In fact, it is quite possible that soy plantings will surpass corn for the first time since 1983, as suggested by the USDA in the prospective plantings report.
Download the report for full analysis on U.S. crop production
European Union
The past two seasons were not ideal for production in the European Union, as crops were stricken with excessive precipitation or dryness accompanied by heat waves.
This season, with minor to no winterkill and sufficient precipitation in spring and early summer, wheat and rapeseed production is set to be approximately 156 and 22.7 million tons, respectively.
Watch: Agriculture Weather Dashboard Maps
Production, however, can drop to 138 and 19.6 million tons with late-season spring frosts during rapeseed blooming and drought in spring and summer.
On the other hand, with adequate weather during the season, especially during wheat heading and rapeseed blooming stages, production may reach 162 and 24 million tons.
Higher prices and increased demand for rapeseed will likely lead to farmers sowing more winter rapeseed this year.
However, unfavorable weather conditions locally across Europe (Germany and Poland, in particular) have prevented farmers from completing intended plantings, which partially offsets the potential for increased rapeseed areas.
Low barley prices will continue to decrease its planted area, as farmers switch to more profitable crops.
Download the report here for full analysis on European crop production
The Black Sea
For the past couple of years, Russia and Ukraine have been breaking one grain production record after another. What has been the cause behind this tremendous rise in grain production? Do we foresee further increases?
Starting in the late 1990s, yields in both countries began a steadily upward trend. Today, Russia and Ukraine are among the world’s largest wheat producers.
In 2017/18, Russia produced 85 million tons; Ukraine 27 million tons. Russia now holds the title of the world’s largest exporter.
The major drivers have been higher investments in agriculture, land privatization, and the creation of so-called “agroholdings,” all of which resulted in better inputs and technology.
Ukrainian and Russian farmers are using better quality seeds, along with more efficient crop protection, fertilizers and irrigation. In addition, for the past few seasons they were lucky to get the right weather at the right time.
Download the report for full analysis on Black Sea crop production
