U.S. wheat exports and world trade up this month

decrease font size  Resize text   increase font size       Printer-friendly version of this article Printer-friendly version of this article

World wheat trade for July-June international trade year 2011/12 is projected up 0.7 million tons to reach 138.8 million tons this month. Export prospects for Russia are increased 1.0 million tons to 20.5 million. The country has already shipped more than 16 million tons of wheat, and despite logistical difficulties associated with wintry weather, the country is on track to export another 1.5 million tons in February.

The Government has alleviated fears that grain export duties would be imposed in the near future when it recently raised its maximum target for all grain exports from 24 to 27 million tons, well above the level currently expected. The Russian Government now appears confident that domestic needs will not be threatened even with an additional 3 million tons of exports. In both Argentina and Brazil, wheat exports are up 0.5 million tons each. Argentine wheat exports are projected to reach 9.7 million tons as the pace of shipments is strong, and the Argentine Government has indicated that its grain export controls could become more predictable and less binding for the farmers anytime soon. Brazilian wheat exports are projected 100 percent higher at 1.0 million tons.

The country has an excess of low-quality wheat that does not meet domestic milling requirements. The Brazilian Government provides export assistance via its auction program, the so called PEP, and appears to have secured sales of feed wheat to EU-27.

Exports prospects for Ukrainian wheat decreased 1.0 million tons to 6.0 million, as the pace of shipments continue to lag behind. Bureaucratic barriers and severe winter conditions–low temperatures, high winds and ice in the ports–have been identified as the main obstacles to exporting wheat. However, those hurdles have not impeded corn exports that gallop ahead at a pace unheard of before. With wheat stocks projected at more than double the country’s 10-year average, there seem to be no economic reasons for the current scale of wheat exports.

The reasons might lie in the murkier area of nonofficial agreements between the Government and the State trade companies. It appears that those companies have been given the green light to export corn because supplies are ample, and high corn output is widely expected in 2012 as most wheat fields damaged by winterkill will be re-seeded with corn. At the same time, an unofficial lid has likely been applied to wheat exports as–quite opposite to corn–wheat is expected to be in short supply next season following substantial damage to winter crops.

Canadian wheat exports are projected down 0.5 million tons to 17.5 million, as the pace of exports this year is lagging behind the 5-year average of 18.0 million tons. As was mentioned above in the consumption section, Canada has been somewhat behind in a competitive battle with other feed wheat suppliers (mainly EU-27, Russia, and Ukraine).

Another reason for this comparatively slow export pace could be that the Canadian Wheat Board has been marketing its high-quality wheat less aggressively (not willing to lower prices) in order to maintain a price premium at a time of strong demand for high-quality wheat varieties. Wheat exports are also projected down for India by 0.3 million tons to 0.7 million, as wheat appears to be uncompetitive for private exporters, while exports under government direct agreements are estimated at only 0.1 million tons.

Imports are adjusted up for a total of 0.7 million tons for several countries this month, mostly based on the pace of recent sales and shipments. Saudi Arabian and Mexican wheat import prospects are increased 0.3 and 0.2 million tons to 2.3 and 4.2 million, respectively, reflecting higher feed-wheat demand, as already mentioned above in the discussion involving feed-wheat consumption. Imports are up 0.1 million tons for Chile based on increase of wheat products (pasta) imports, and for Ethiopia reflecting an increase in food aid.

The recent pace of U.S. sales and shipments of wheat supports a 0.5-million-ton increase in exports to 25.5 million for the international July-June trade year (up 25 million bushels to 975 million for the June-May local marketing year). Despite recent price increases that have made higher quality U.S. wheat less competitive in price-sensitive markets, the United States continues to sell additional exports to traditional customers like Japan and Mexico. U.S. feed-quality wheat also remains competitive with corn in many traditional U.S. corn export markets.

With commitments (shipments plus outstanding sales) just over 22 million tons as of February 2, even a slow pace of additional sales will bring 2011/12 U.S. wheat exports to 25.5 million tons, down 10.5 million tons, or 29 percent on the year.

Source: Wheat Outlook


Buyers Guide

Doyle Equipment Manufacturing Co.
Doyle Equipment Manufacturing prides themselves as being “The King of the Rotary’s” with their Direct Drive Rotary Blend Systems. With numerous setup possibilities and sizes, ranging from a  more...
A.J. Sackett Sons & Company
Sackett Blend Towers feature the H.I.M, High Intensity Mixer, the next generation of blending and coating technology which supports Precision Fertilizer Blending®. Its unique design allows  more...
R&R Manufacturing Inc.
The R&R Minuteman Blend System is the original proven performer. Fast, precise blending with a compact foot print. Significantly lower horsepower requirement. Low inload height with large  more...
Junge Control Inc.
Junge Control Inc. creates state-of-the-art product blending and measuring solutions that allow you to totally maximize operating efficiency with amazing accuracy and repeatability, superior  more...
Yargus Manufacturing
The flagship blending system for the Layco product line is the fully automated Layco DW System™. The advanced technology of the Layco DW (Declining Weight) system results in a blending  more...
Yargus Manufacturing
The LAYCOTE™ Automated Coating System provides a new level of coating accuracy for a stand-alone coating system or for coating (impregnating) in an automated blending system. The unique  more...
John Deere
The DN345 Drawn Dry Spreader can carry more than 12 tons of fertilizer and 17.5 tons of lime. Designed to operate at field speeds up to 20 MPH with full loads and the G4 spreader uniformly  more...
Force Unlimited
The Pro-Force is a multi-purpose spreader with a wider apron and steeper sides. Our Pro-Force has the most aggressive 30” spinner on the market, and is capable of spreading higher rates of  more...
BBI Spreaders
MagnaSpread 2 & MagnaSpread 3 — With BBI’s patented multi-bin technology, these spreaders operate multiple hoppers guided by independent, variable-rate technology. These models are built on  more...


Comments (0) Leave a comment 

Name
e-Mail (required)
Location

Comment:

characters left


X-TENDED REACH GRAIN CARTS

YOUR BEST HARVEST IS NOW WITHIN REACH J&M introduces their patented line of X-tended Reach grain carts, featuring a frontfolding single ... Read More

View all Products in this segment

View All Buyers Guides

Feedback Form
Feedback Form