USDA: Global wheat production to reach new record
Following a year with unfavorable weather that reduced the wheat production of several major suppliers, the USDA expects global production in marketing year 2013/14 to rebound and surpass the record set in 2011/12. According to USDA’s first official World Agricultural Supply and Demand Estimates report that includes estimates for the new marketing year starting June 1, global production is projected to increase 7 percent to 701 million metric tons (MMT), 4 percent greater than the five-year average. USDA predicts greater output will bolster world wheat supplies and help meet increased demand.
Three Black Sea countries have emerged as key players in the global wheat market during the last decade. But just as important as the volume produced by Russia, Kazakhstan and Ukraine is the inconsistency in their production. In the last five years, the Black Sea region has alternated between 30 percent year-over-year reductions and 50 percent increases in production. Black Sea exports have followed this trend closely. USDA projects the region’s 2013/14 production to increase 47 percent from 63.3 MMT in 2012/13 to 93.0 MMT; that would be 7 percent greater than the five-year average.
USDA expects 2013/14 Russian wheat production to increase an estimated 48 percent to 56.0 MMT and exports to jump 68 percent to 18.0 MMT. Dry spring conditions currently threaten potential yields, but the overall weather outlook remains much better than last year at this time. USDA projects Ukrainian production will increase 40 percent to 22.0 MMT and exports will jump 36 percent to 9.5 MMT, the second highest on record, if realized. It is worth noting, however, that agricultural consultancy UkrAgroConsult lowered its forecast for Ukrainian production and exports this week citing poor crop conditions and soil moisture deficits. Kazakhstan’s 2013/14 production will increase an estimated 52 percent to 15.0 MMT, according to USDA, and exports will rise 15 percent to 7.5 MMT.
Of the five traditional major wheat exporters, USDA expects production to increase in each country except the United States. Argentina is expected to grow 18 percent from 2012/13 to 13.0 MMT, but that is 3 percent below the five-year average. USDA puts Argentina’s 2013/14 estimated exports at 7.0 MMT, up 40 percent from 2012/13, but 11 percent below the five-year average. USDA expects both Australia and the European Union to produce more wheat in 2013/14 than in 2012/13, but also projects both countries will export less wheat. According to USDA, Australia will produce an estimated 24.5 MMT, an 11 percent increase, but export 6 percent less wheat at 17.0 MMT. At 139 MMT, the European Union is expected to produce 5 percent more wheat in 2013/14 but export 17.0 MMT, a 21 percent reduction. While USDA projects Canada will produce 5 percent more wheat at 29.0 MMT in 2013/14, exports are expected to remain unchanged from 2012/13 at 18.5 MMT.