U.S. wheat supplies for 2012/2013 are raised 54 million bushels with higher forecast production and an increase in projected imports. Production is forecast 44 million bushels higher with increased yields for winter wheat, durum, and other spring wheat.

Feed and residual use is projected 20 million bushels higher, reflecting the tighter supply situation for corn. Ending stocks for 2012/13 are projected 34 million bushels higher. The projected range for the 2012/13 season average farm price is raised substantially to $7.60 to $9.00 per bushel, compared with $6.20 to $7.40 per bushel last month, as tighter foreign wheat supplies and sharply higher corn prices raise price prospects for the remainder of the marketing year.

Despite reduced wheat production prospects, and sharply higher world wheat prices, foreign wheat use for 2012/13 is projected up, with more wheat being used for feed. Projected 2012/13 world wheat ending stocks are down this month 5.3 million tons, and are projected to decline this month in all major wheat-exporting countries, except the United States and Argentina. Competition among exporters for 2012/13 is driven by a massive reduction in Russian exports following its wheat production cut.

Projected U.S exports are unchanged as high domestic wheat prices spurred by skyrocketing corn prices are expected to limit the competitiveness of U.S. supplies in world markets. Record world wheat trade for 2011/12 is projected to increase further this month.

Source: Wheat Outlook