WASDE Wheat: Higher U.S. Beginning Stocks, Imports Offset by Lower Production

Projected 2017/18 U.S. wheat supplies are lowered this month on reduced U.S. wheat production more than offsetting higher beginning stocks and imports. Forecast 2017/18 U.S. wheat production is lowered 64 million bushels to 1,760 million. The NASS July Crop Production report provides survey-based production forecasts for all wheat classes for the first time in the 2017/18 crop year.

The production forecasts for durum and other spring wheat indicated a significant decline compared to last year for these two classes primarily due to severe drought conditions affecting the Northern Plains. Partially offsetting this decrease is higher winter wheat production on both higher harvested acreage and yield.

Projected exports and feed and residual usage are lowered to 975 and 150 million bushels, respectively, largely on the reduction in durum and other spring wheat supplies. Projected 2017/18 ending stocks are raised 14 million bushels to 938 million this month, but are 21 percent lower than last year’s revised stocks.

The 2017/18 season-average farm price is raised $0.50 per bushel at the midpoint to a projected range of $4.40 to $5.20.

Global 2017/18 wheat supplies are decreased fractionally on lower production forecasts for the U.S., Australia, China, and the EU, which are partially offset by higher production expected for Russia and Turkey.

Russia’s wheat production is increased by 3.0 million tons to 72.0 million as growing conditions to date are similar to last year when Russia achieved record yields. Turkey’s wheat production is up 1.5 million tons to 19.5 million on favorable crop conditions. European Union wheat production is down 0.8 million tons to 150.0 million on smaller expected crops in Spain and France. Australia’s 2017/18 production is reduced 1.5 million tons to 23.5 million on dry conditions.

Grain Commentary

Foreign 2017/18 exports are increased on higher exports for Russia and Turkey more than offsetting reductions for the EU, Paraguay, and Ukraine. Imports are projected lower for several countries with Turkey showing the largest reduction on a significantly larger crop.

Total world consumption is projected higher, primarily on greater use by Russia on increased supplies. Global ending stocks are projected lower at 260.6 million tons, down marginally from last month.

Full report.

The Latest