Despite Production Increase, U.S. Wheat Crop Remains Small

The USDA’s October U.S. supply and demand estimates show a larger production forecast when it comes to wheat. So, what does that mean for the balance sheet?

“Three million bushel increase in production, a little bit of an increase in imports," said World Agricultural Outlook Board Chair Mark Jekanowski. "Total supply is up by eight million bushels. Even with that increase in production this month, this is still the lowest U.S. wheat production since 1970. A few other changes we made to the balance sheet would include reducing our export forecast. We lowered that by 25 million bushels. We lowered our hard red winter export forecast by 20 million bushels. We ended up with a 23 million bushel increase in ending stocks.”

Canada Looks To Have A Good Crop

Jekanowski said there was very little change to report when looking at global production.

"We are truing up to recent harvest results from the northern hemisphere producers. Canada looks like they're going to have a very good crop," said Jekanowski. "We raised their production forecast by half a million tons up to 36.5 million tons. They've just had very good and consistent rains throughout the growing season, favorable temperatures supporting the outlook for that crop. On the other hand, EU wheat production, we lowered by 800,000 tons, mainly reflecting recent harvest results from Germany. So lowered that crop on poor conditions throughout that growing season.”

Jekanowski added Turkey’s figure was increased by half a million tons based on harvest results and higher observed yields.

In addition, USDA also lowered the season ending average price forecast by a dime to $6.30 a bushel.