July 26, 2018 / 1:36 PM / 4 months ago

UPDATE 1-IGC cuts forecast for world wheat crop to five-year low

* IGC sees potential for further crop output cuts

* Wheat crop outlooks cut for top four EU producers (Adds details, comments)

LONDON, July 26 (Reuters) - World wheat production is set to fall to a five-year low following significant downgrades to crop prospects in the European Union and Russia, the International Grains Council said on Thursday.

The inter-governmental body cut its forecast for world wheat production in 2018/19 by 16 million tonnes to 721 million, the lowest total since the 2013/14 season.

The EU wheat crop was seen at 139.9 million tonnes, down from a previous projection of 147.3 million, with forecasts for the top four producers in the trading bloc, France, Germany, Britain and Poland, all revised down.

Dry and hot weather in northern and central parts of Europe have damaged crops in recent weeks and sent Euronext wheat futures to a three-year high this week.

“Furthermore, with disappointing results being reported from ongoing harvesting, there is potential for further output cuts in future grain market reports,” the IGC said.

Russia’s wheat crop was forecast to fall to 66 million tonnes, down from a previous projection of 70.9 million and far below the prior season’s 84.9 million.

Global wheat stocks were forecast to fall to a two-year low of 247 million tonnes with production set to fail to keep pace with consumption in 2018/19 which was seen at 739 million.

The IGC kept its forecast for world corn (maize) production in 2018/19 at 1.052 billion tonnes, slightly above the prior season’s 1.044 billion, but a second successive global deficit was expected with consumption seen at 1.098 billion.

“A projected increase in maize largely hinges on a recovery in output in South America where planting for 2018/19 is still some months away,” the IGC said.

World soybean production in 2018/19 was put at 359 million tonnes, marginally up from a previous projection of 358 million. A small global surplus was anticipated with consumption projected at 356 million. (Reporting by Nigel Hunt; editing by Jason Neely and Jane Merriman)

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