LONDON (Dow Jones) -- The International Grains Council on Thursday increased its forecast for global grain production in 2016-17 by 10 million metric tons to 2.015 billion tons on improving prospects for the wheat harvest in the E.U., Russia and the U.S.
If the forecast is correct, the 2016-17 harvest will be the second-largest on record after the 2.046 billion-ton crop of 2014-15, the London-based IGC said.
The wheat crop forecast was lifted by 5 million tons to 722 million tons. The corn forecast was raised 5 million tons to 1.003 billion tons as harvest prospects improved in the U.S. and Argentina.
As a result, the IGC expects global grain stocks to climb from 468 million tons at the end of the current year to a record-high 474 million tons at the end of 2016-17. China's share of that total could exceed 40%.
For the current 2015-16 crop year, the IGC cut its forecast for soybean production by 5 million metric tons to 314 million tons, a 2% drop from the previous year's output, due to bad weather in South America.
In a "highly tentative" forecast for 2016-17, the IGC said soybean production could rebound to 320 million tons, but this year's smaller harvest and increasing demand will mean global stocks are likely to dwindle. It cut its soybean stocks forecast for the end of 2016-17 by 3 million tons to 29 million tons.