World wheat production down sharply this month

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World wheat production for 2012/13 is projected to decline by 6.7 million tons this month because of a 6.5-million-ton drop in foreign production and a slight decrease in U.S. wheat production.

The projection for foreign wheat output for 2012/13 is reduced this month to 604.8 million tons. This leaves foreign wheat production 35.5 million tons lower than estimated for the previous year.FSU-12 dominates in this month’s decline, as wheat production in this region is projected down 6.2 million tons: down 4.0 million tons to 49.0 million for Russia, down 2.0 million tons to 13.0 million for Kazakhstan, and down 0.2 million tons to 0.5 million (about a 30 percent decline) for Moldova. From Moldova in the west to the south of Russia and the Volga Valley to the spring wheat areas of Siberia and parts of northern Kazakhstan in the east of the continent, growing conditions continued to deteriorate in June.

Expectations that key wheat areas in the South District of Russia would partly recover in June, helped by rains in the beginning of the month, did not materialize because of unrelenting, stressful heat of 35 C (95 F) that quickly wiped out accumulated moisture. Winter wheat harvesting in Russia started 10 days earlier than usual with accelerated maturation of the wheat crop, and harvest reports show about a 30-percent decline in wheat yields compared to last year, when approximately the same size of area was harvested (Russian Ministry of Agriculture reports as of July 9, 2012, and July 16, 2011).

To make matters worse, torrential rains during the last 2 weeks in the South of Russia (Krasnodar and Stavropol) virtually halted harvesting, and are expected to reduce the quantity and quality of winter wheat in those major producing regions. As for spring wheat, planting has been virtually completed with the latest reports indicating lower than expected sown spring wheat area, down 1.0 million hectares this month. Hot and dry weather accelerated spring wheat development in the lower Central and Volga Districts (flowering and filling stages), as well as in the Altay and Novosibirsk regions of Russia and in northern Kazakhstan (heading and flowering).

These weather conditions made the crop more vulnerable to persistent high temperatures and low soil moisture levels. Satellite-derived vegetative indices support this picture, confirming sustained damage to the spring wheat crop. Wheat production changes are projected for the past 2 years for China, down 2.0 million tons to 118.0 million for 2012/13, and up 0.5 million tons to 117.9 for 2011/12.

The 2011/12 estimate has been recently released by the Government statistical service (China National Bureau of Statistics), and the 2012/13 crop size reflects early indications from estimates by the China National Grain and Oils Information Center. Wheat production in 2012/13 is still being projected at a record level, though just slightly higher than last year’s volume, reflecting good growing conditions in some areas, but problems in parts of the North China Plain that had an exceptionally dry spring.

Canadian 2012/13 wheat production is reduced by 0.4 million tons to 26.6 million this month, which is still 1.3 million tons higher year to year. The decrease is entirely based on a 0.15- million-hectare reduction in sown area, down to 9.35 million hectares, but still up 80,500 hectares on the year. As reported by Statistics Canada, wet conditions in the Prairies delayed sowing, especially in Saskatchewan that produces half of Canada’s wheat and in Manitoba that accounts for 15 percent of the country’s wheat production. Although both provinces are expected to have a healthy increase in wheat sown area on the year, the preliminary estimates have been slightly lowered. This month’s reduction in foreign wheat production is partly offset by an increase in 2012/13 production prospects in the EU-27, up 2.1 million tons to 133.1 million. Timely abundant June precipitation in the northern parts of the European continent benefited the wheat crop in France, Germany, Hungary, Latvia, Lithuania, and Netherlands, and warranted this month’s increase in yield prospects for these countries, of a total of 2.5 million tons.

This increase more than offsets area and yield reductions in Poland, such that production is down 0.4 million tons. Despite recent precipitation in Poland, wheat appears not to have recovered from adverse winter and spring conditions, and current projected yields better reflect the impact of that earlier weather.

Source: Wheat Outlook report

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