U.S. 2011/2012 wheat supplies and ending stocks down

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U.S. wheat supplies for 2011/12 are lowered this month as reduced carryin more than offsets an increase in expected production. Beginning stocks are lowered 30 million bushels with a 10- million-bushel reduction in imports and a 20-million-bushel increase in exports for 2010/11, both based on the pace of shipments to date.

All wheat production for 2011/12 is forecast at 2,058 million bushels, 15 million higher than last month. The winter wheat production forecast is raised 26 million bushels, with higher forecast yields for hard red winter, soft red winter, and soft white winter wheat. Partly offsetting is a projected  11-million-bushel reduction for durum and other spring wheat production as seedings are projected 290,000 acres lower. Flooding and persistent wet soils have delayed planting in North Dakota and Montana well beyond the normal planting window.

U.S. wheat usage for 2011/12 is unchanged. Ending stocks are projected 15 million bushels lower at 687 million bushels, but remain above the 10-year average. The 2011/12 season-average farm price for all wheat is projected at a record $7.00 to $8.40 per bushel, up 20 cents on both ends of the range, reflecting both tighter domestic supplies and higher expected corn prices. The forecast 2010/11 wheat farm price is also raised this month, up 5 cents per bushel to $5.70 per bushel.

World wheat production for 2010/11 is projected down 5.2 million tons to 664.3 million this month. Europe Union (EU-27) wheat output is projected down 7.1 million tons to 131.5 million this month, and is 4.2 million lower than last year. Wheat production prospects in Canada are lowered 1.0 million tons to 25.0 million, reflecting a 0.4-million-hectare area reduction. A combination of projected increases in wheat beginning stocks and reductions in forecast wheat use exceeds wheat production cuts and generates an increase in projected global ending stocks of 3.0 million tons to 184.3 million.

Sharply reduced production prospects in EU-27 this month have cut this region’s export prospects, boosting exports for some competitors. Reduced exports from EU-27 are more than offset by increases for Australia, Argentina, and Pakistan, leaving 2011/12 trade year world wheat trade up fractionally this month at 126.9 million tons.



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