Droughts and war in Ukraine led to global grain reserves decade low — Reuters

Despite the resumption of exports from Ukraine, the world is heading towards its lowest grain stocks in years as supplies are tight and other major grain producers' harvests are lower than initially expected.

Reuters writes about this with reference to data on grain supplies and harvest forecasts.

Importers, food producers, and livestock farmers had hoped that crop availability would improve after war-torn Ukraine resumed shipments from Black Sea ports this summer and US farmers planted bumper crops.

But the United States, the world's top corn producer, is expected to harvest its smallest corn crop in three years. The drought has also damaged European crops and threatens the upcoming planting season in South America," the agency writes.

By the end of the 2022/23 crop year, global corn stocks will last just 80 days of consumption, down 28% from five years ago and the lowest level since 2010/11, according to data compiled for Reuters by the International Grains Council.

In this regard, world officials are worried.

Thus, the World Bank has allocated US$30 billion to compensate for food shortages worsened by the war. US President Joe Biden last week announced the allocation of almost US$3 billion in additional funding for food security.

According to the United Nations, half a million Somali children are at risk of starvation in the worst famine this century amid a severe drought in Africa.

However, the drought could lead to further reductions in global supplies, especially if the current dry weather in South America persists into the main planting season as the crop cycle shifts to the southern hemisphere.

As the publication emphasizes, crop forecasts in Argentina – the world's third corn exporter – have already been lowered due to dry weather.

In addition, EU production is expected to hit a 15-year low, a decline that will push the bloc to increase imports from Ukraine in 2022/23 by around 30% compared to the previous year to 10.4 million tonnes, said consultancy Strategie Grains.