The International Grains Council forecast a continuation of “elevated” grain prices, as it trimmed hopes for the harvest in heat-tested Europe, and restated a forecast for world stocks to shrink to an eight-year low.

The intergovernmental group, while reporting grain prices down 10.1% over the past month to their lowest since January, noted that values of major crops, except rice, remained well above historic averages, and year-ago levels.

Wheat prices remained 23% higher year on year, with barley values up 39%.

And it forecast values remaining high enough to spur a rare downturn in world grains consumption in 2022-23, expanding its estimate for the decline by 5m tonnes from last month to 11m tonnes.

“Amid tighter supplies and anticipated elevated prices, total consumption could dip slightly on lower feed use,” the council said, although seeing food and industrial use of grains “edging higher”.

‘Tighten again’

The IGC restated a forecast for world grain stocks to end 2022-23 at 583m tonnes – down 24m tonnes year on year, and their lowest since 2014-15.

“After a small gain in the season before, carryover stocks are projected to tighten again, placed at an eight-year low,” the council said.

The forecast factored in a reduction of 3m tonnes in the estimate for world grains output, “mainly to reflect drought stress in the European Union, including for wheat, barley and maize”.

Persistent heat and dryness in countries including France and Germany, the EU’s top two grain producers, has prompted some commentators to downgrade expectations for the bloc’s harvest this year.

The council forecast the 2022-23 global grain harvest, at 2.252bn tonnes, falling by 40m tonnes year on year, “potentially the first contraction in five seasons”.