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Corn+Soybean Digest

World Wheat Supplies Up

June’s USDAWorld Agricultural Supply and Demand Estimates (WASDE) indicate that U.S. wheat supplies for 2010-2011 are increased slightly this month as higher production is mostly offset by lower carry-in. Winter wheat production is forecast 24 million bushels higher mostly on higher hard red winter wheat.

Winter wheat yields were raised in the central and northern plains and in the Pacific Northwest. Beginning stocks are projected 20 million bushels lower as strong exports of wheat, flour and products during the final weeks of the old-crop marketing year boost 2009-2010 exports 20 million bushels.

Domestic use for 2010-2011 is projected 10 million bushels higher as lower prices encourage more wheat feeding. Ending stocks for 2010-2011 are projected 6 million bushels lower, but remain up year-to-year and the highest since 1987-1988. The season-average farm price for all wheat is projected at $4-4.80/bu., down from $4.10-5.10/bu. last month. Recent declines in futures prices and lower-than-expected protein levels in hard red winter wheat have sharply reduced price prospects for many producers.

Global wheat supplies for 2010-2011 are projected 4.1 million tons lower this month with reduced carry-in and production. Lower beginning stocks mostly reflect reductions for EU-27, the U.S. and Brazil as 2009-2010 exports are raised for all three. Global production for 2010-2011 is lowered 3.7 million tons with reductions for EU-27, Syria, Turkey and Russia. EU-27 production is lowered 2.1 million tons reflecting crop damage from recent flooding and heavy rains in Eastern Europe and April and May dryness in northwest France and the United Kingdom.

Production for Syria and Turkey are lowered by 1.3 and 1 million tons, respectively, as widespread outbreaks of yellow rust have sharply reduced yield prospects in key growing areas of both countries. Russia production is lowered 0.5 million tons as reports of higher-than-expected winterkill, particularly in the Volga Valley, reduce potential harvested area. Production is raised 0.5 million tons for Ukraine as recent rains have improved yield prospects.

Global wheat trade for 2010-2011 is raised with world imports up 2 million tons. Import increases include Syria, Turkey, Afghanistan and Bangladesh. Exports are raised for Kazakhstan, Australia, Ukraine and India. World wheat consumption is nearly unchanged as a 1.0-million-ton increase in China wheat feeding is offset by the same size reduction for EU-27.

Global ending stocks are projected 4.2 million tons lower at 193.9 million tons. Global ending stocks for 2010-2011 are expected to be up 1 million tons from beginning stocks.

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