August 13, 2022

Larger U.S. Supplies Compensate for Increased Use and Exports – AgFax

The outlook for 2022/23 US wheat this month is for larger supplies, domestic use, exports and ending stocks. Supplies are boosted by increased production, which is up 44 million bushels to 1,781 million, thanks to an increase in harvested area and higher yields.

Early survey-based production forecasts for 2022 for other spring and durum wheats indicated a sharp increase from last year’s drought-reduced production to 503 million and 77 million bushels, respectively. Winter wheat production is also expected to increase to 1,201 million bushels on the back of an increase in harvested area.

The export forecast for 2022/23 is raised by 25 million bushels to 800 million, as the recent drop in US prices makes exports more competitive in international markets. The projected seasonal average farm price (SAFP) is lowered by $0.25 a bushel to $10.50 due to lower futures and spot prices.

The global wheat outlook for 2022/23 predicts lower supplies, lower consumption, higher exports and higher stocks. Supplies are reduced by 1.1 million tonnes to 1,051.7 million, as lower production is partially offset by higher opening stocks. Production is revised downwards for the EU, Ukraine and Argentina, which is only partially offset by upward revisions for Canada, the United States and Russia.

EU production is reduced by 2.0 million tonnes to 134.1 million as continued dry weather reduced yield prospects mainly in Spain, Italy and Germany. Ukrainian production is reduced by 2.0 million tonnes to 19.5 million due to a reduction in harvested area, as indicated by government statistics.

Production in Canada increased by 1.0 million tonnes to 34.0 million according to Statistics Canada’s survey of principal field crop areas, which shows seeded area above intentions. World trade forecast for 2022/23 is increased by 0.9 million tonnes to 205.5 million, with higher exports from Canada and the United States only partially offset by lower exports from Argentina and of the EU.

Global consumption is reduced by 1.8 million tonnes to 784.2 million, mainly due to reduced feed and residual use in the EU and Ukraine. Projected global ending stocks for 2022/23 are raised by 0.7 million tonnes to 267.5 million, but remain the lowest since 2016/17.

Full report.

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