Forget about a world wheat panic. USDA says despite the big shortfalls in Russia and Europe - the U.S. and others - plus demand adjustments - will make up the losses.
World Ag Outlook Chair Gerry Bange says the latest USDA supply and demand report forecasts wheat losses from Russia, Ukraine, Kazakhstan and the European Union at 15.3-million tons. But Bange says almost six-million tons will be made up through lower trade from higher prices - and the rest - by greater exports elsewhere…
“5.4 million tons, to be exact, additionally being exported by the US. Then we have approximately 4 million tons being exported by these other countries like Australia, EU, Turkey and China. That’s about 9 million tons there.”
With much of it going into Russian markets in North Africa and the Middle East - and averting any global wheat panic similar to 2008…
“Our stocks at that point, the world stocks are down very, very sharply compared to where they are now. We had, we’re coming into this situation with a very strong world stocks level on…being held by the major exporters and the US.”
But the tighter global supply picture and stronger exports boosts the U.S. price forecast by 50-cents to a season average five-dollars and 10-cents.
Meantime - U.S. corn exports are forecast up 100-million bushels to over two-billion bushels on less global wheat feeding. Corn yields and production hit new records…
“The National Ag Statistics Service predicted….forecast a 2010-2011 yield would be 165 bushels an acre, that’s a record. If that comes to pass, that would be a record compared to the 164.7 bushels per acre in 2009-10, the previous record. And now we’re looking at a production now at 13.365 bushels per acre, which is a record high production level for the US.”
With average prices still up a nickel at 3.80 a bushel on smaller - but still strong - ending stocks.
Soybean production is also pegged at a record of 3.4-billion bushels - average yields tied with the previous record - 44-bushels an acre - and prices up 40-cents at 9.25 a bushel. Soybean exports remain strong - though off a bit from 2009-2010 - at 1.4-billion bushels - but still up about five-percent from last month’s forecast on continued strong sales to China.