20210714-USDA-USDA_Wheat_Outlook_2021.07.14_15页_1mb

Wheat Outlook Summary: July 2021

Core Content

This report provides an overview of the U.S. and global wheat supply and demand outlook for the 2021/22 marketing year. Key factors influencing supply include reduced production and carryover stocks, while demand is affected by trade dynamics and weather conditions.

Main Points

• U.S. Wheat Outlook:

  • Production Cut: U.S. wheat production for 2021/22 is forecast at 1,746 million bushels, a reduction of 152 million bushels from the June forecast.
  • Durum and Other Spring Wheat: Durum production is down 46% from 2020, to 37.2 million bushels, while other spring wheat production is down 41%, to 345 million bushels.
  • Drought Impact: 95% of durum production and 98% of other spring wheat production are in drought-affected areas.
  • Supply and Use: Total U.S. supply is down to 2,735 million bushels, with total use also reduced by 35 million bushels.
  • Ending Stocks: Ending stocks are projected at 665 million bushels, a 105 million bushel decrease from the previous month.
  • Farm Price: The season-average farm price (SAFP) is forecast to increase by 10 cents to $6.60 per bushel due to a tighter stocks-to-use ratio.

• Domestic Outlook:

  • Hard Red Winter (HRW): Production is expected to increase, with a rebound in area and yield. However, protein levels may be slightly lower due to wetter conditions.
  • Hard Red Spring (HRS): Production is significantly down due to drought in the Northern Plains, with ending stocks projected as the smallest since 2007/08.
  • Soft Red Winter (SRW): The only class with higher ending stocks, projected at 105 million bushels.
  • White Wheat: Production is down 22%, mainly due to dry conditions in the PNW, with ending stocks projected as the tightest since 2013/14.

• Global Wheat Outlook:

  • Production: Global production is estimated at 792.4 million MT, a slight decrease of 2 million MT from the previous month.
  • U.S. Production: Reduced by 4.1 million MT to 47.5 million MT, mainly due to lower spring wheat and durum yields.
  • Foreign Production: Increased by 2.1 million MT to 744.9 million MT, driven by Australia and other regions.
  • Record Yields: Ukraine and Moldova are projected to have record yields, with Ukraine's yield reaching a new high of 4.18 MT/ha.
  • Kazakhstan: Production is down 1 million MT to 13.0 million MT due to dryness and lower harvest areas.
  • Russia: Production is reduced by 1 million MT, split evenly between spring and winter wheat.
  • Canada: Production is down by 0.5 million MT to 31.5 million MT due to drought, extreme heat, and wind.

Key Information

• Supply and Use:

  • U.S. Total Supply: 2,735 million bushels, down 140 million bushels from the June forecast.
  • U.S. Total Use: 2,070 million bushels, down 35 million bushels.
  • Global Consumption: Marginal decrease to 790.9 million MT, with FSI consumption increased by 1.7 million MT.
  • Feed and Residual Use: Decreased by 172,000 MT globally, with major reductions in Russia, Kazakhstan, and the U.S.

• Trade Adjustments:

  • Global Trade: Increased by 1.5 million MT to 205.5 million MT.
  • Exports: Australia and the EU are projected to increase exports by 1 million MT each.
  • Imports: Pakistan's imports are expected to surge by 1.5 million MT due to strategic reserve needs.
  • Key Importers: Nigeria and Thailand are also seeing increased import levels.
  • Key Exporters: Canada and the U.S. are projected to see reduced exports due to lower production and tighter supplies.

Summary Table

Conclusion

The 2021/22 wheat outlook is characterized by reduced U.S. production and carryover stocks, leading to tighter supply and higher farm prices. Global production remains at a record level, but some major producers like Russia and Kazakhstan are experiencing declines due to adverse weather conditions. Trade dynamics and strategic import decisions, particularly in Pakistan, are influencing global trade volumes and consumption trends. The report highlights the importance of weather conditions and trade policies in shaping the wheat market.