Wheat Outlook: Global Export Forecast Raised on Higher Production for Russia, Argentina

    Largely on the strength of production increases for Argentina (+0.5 million metric tons) and Russia (+1.0 million), 2019/20 global wheat exports are raised 0.8 million metric tons to 183.62 million. Aided by a sizable crop, exports for Argentina have surged in current marketing year. Before an import tax was imposed, Argentine exporters were also motivated to aggresively market wheat, most notably to Brazil.

    A modest bump in production and strong demand from Turkey lifts prospects for Russian wheat exports in 2019/20 and helps the nation to maintain its status as the leading global wheat exporter for a third year in a row. Recent softening of Black Sea milling wheat prices have enhanced Russia’s competitiveness, especially in price-sensitive markets and developing countries.

    Domestic Outlook

    Winter Wheat Conditions Reflect Improving Soil Moisture

    As of March 9, 2020, USDA’s National Agricultural Statistics Service (USDA-NASS) reports that 47 percent of the winter wheat crop in Kansas rated good to excellent (vs. 43 percent the week prior). Fifty-eight percent of winter wheat in Oklahoma rated good to excellent as of March 8 (vs. 57 percent the week prior), while 26 percent of the Texas crop rated similarly. During the week of February 23-29, significant precipitation fell in Kansas, helping to abate some of the drought that had persisted in the southwest corner of the State.

    Relatively small patches of drought remain in Kansas, where much of the U.S. winter wheat crop is grown. More wide-spread drought remains in Colorado, where approximately 8 percent of the 2019/20 winter wheat crop was harvested. Colorado has not yet begun reporting 2020/21 winter wheat conditions. It is expected that USDA-NASS will begin more wide-spread conditions reports in April.

    Revised Out-Year Projections Released at USDA’s Annual Agricultural Outlook Forum

    USDA hosted its 96th annual Agricultural Outlook Forum on February 20-21, 2020. On the event’s second day, the Grains and Oilseeds Outlook was presented, accompanied by the publication of updated first-year-out projections.

    For 2020/21, the outlook for U.S. wheat is for tighter supplies, slightly lower total use, and declining ending stocks. U.S. wheat production is forecast to fall 4 percent from the year prior to 1,836 million bushels. Planted area is forecast at 45 million acres and incorporates USDA-NASS acreage estimates for winter wheat plantings.

    Grain News on AgFax

    Unable to display feed at this time.

    Other spring wheat plantings may be affected by persistent wet soil conditions in the Northern Plains, which has the potential to delay or prevent plantings, and lower relative profitability compared to other crops. As of March 7, much of the Northern Plains, a key spring wheat production region, was snow-covered.

    However, a more recent period of warmer weather has allowed some farmers to begin to harvest of the grain crops that had to be left in the field last year.

    Total use in the 2020/21 marketing year is down only very slightly from the year before and remains above the 5-year average. Reduced prospects for wheat feed and residual use, projected to fall 30 million bushels from 2019/20, offset modest gains in food and seed use and serves to lower domestic use by 2 percent to 1,139 million bushels.

    Exports for the new marketing year are forecast to remain level with the current 2019/20 forecast of 1,000 million bushels. Expectations for growth in global wheat demand, combined with tighter stocks for the European Union and Canada, support the U.S. export forecast. Reduced U.S. supplies and relatively stable use lead to substantially tighter ending stocks. At 777 million bushels, carryout for the 2020/21 marketing year is more than 17 percent below the 2019/20 estimate and is the lowest level since 2014/15.

    The tighter out-year balance sheet substantiates a modest increase in the all-wheat season average farm price (SAFP), raised 35 cents from the 2019/20 estimate, to $4.90 per bushel. An updated forecast for the out-year balance sheet will be published in the May World Agriculture Supply and Demand Estimates.

    Wheat SAFP Unchanged from February Forecast

    The U.S. all-wheat season average farm price (SAFP) projection is unchanged this month and remains at $4.55 per bushel. This month saw swings in futures prices, including a multi-month low in late February for the Hard Red Winter wheat contract followed by recovery, and generally weaker cash prices. With approximately 87 percent of the 2019/20 wheat crop marketed through the beginning of March, the modest net price movements did not sway the SAFP.

    Full report.

    The Latest

    Send press releases to

    View All Events

    [ecs-list-events limit="5" key="start date" order="asc"]
    Send press releases to

    View All Events