Economic Research Service Situation and Outlook Report. U.S. 2018/19 Winter Wheat Production Lifted, Price Raised on Improving Export Prospects

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1 Economic Research Service Situation and Outlook Report WHS-18f June 14, 2018 Next release is July 16, 2018 Wheat Outlook Jennifer K. Bond Olga Liefert In this report: - Domestic Outlook - Domestic Feature: Spotlight on North American Grain Transportation. - International Outlook U.S. 2018/19 Winter Wheat Production Lifted, Price Raised on Improving Export Prospects Winter wheat yield projections are raised 0.3 bushels per acre, month-to-month, giving 2018/19 production a 6-million-bushel boost. U.S. all wheat supplies for 2018/19 are lifted by an additional 10 million bushels, carried in from the 2017/18 marketing year on reduced export use. In contrast, export prospects for 2018/19 are improved by 25 million bushels to 950 million. Dry conditions in Russia and the resulting reduced production outlook create opportunities for U.S. wheat in international markets. Increased use tightens the 2018/19 all wheat balance sheet. Along with a 10-cent increase in the season-average farm price for corn, these factors support an equivalent increase in the all wheat season-average farm price, now projected at $5.10 per bushel for 2018/19 (fig.1). Figure 1: U.S. season-average all-wheat farm price (SAFP) and ending stocks ($/bushel) 8 SAFP 7 Ending Stocks Mil. bushels 1,400 1,200 1, Source: USDA, World Agricultural Supply and Demand Estimates.

2 Domestic Outlook Domestic Changes at a Glance: U.S. 2018/19 all wheat supplies are raised 16 million bushels this month on higher forecast winter wheat production and a 10-million-bushel increase in carryin from the 2017/18 marketing year. o All wheat production is now projected up nearly 87 million bushels from the 2017/18 production estimate. o Year-to-year production changes by State are largest for Kansas, Texas, and Oklahoma (fig. 2). Winter wheat production for the new crop year is raised from the May forecast on a 0.3- bushel-per-acre yield increase. o Winter wheat production for 2018/19 is 72 million bushels lower than in 2017/18. o The USDA, National Agricultural Statistics Service (NASS) revised assessment of harvested area prospects by class will be released in the July Crop Production report. Exports for 2018/19 are raised 25 million bushels this month to 950 million on reduced Russian supplies, which creates marketing opportunities for U.S. wheat. Other use categories are unchanged this month; the slight increase in total wheat supplies is more than offset by an increase in exports. U.S. all wheat ending stocks for 2018/19 are reduced 9 million bushels to 946 million. o Old crop ending stocks are raised 10 million bushels from the May forecast on reduced export prospects due to rising transportation costs associated with higher crude oil prices. o On June 29, USDA, NASS will release the Grain Stocks report, providing indications of disappearance through the fourth quarter of the 2017/18 marketing year. Increased tightness in the U.S. all wheat balance sheet combines with a 10-cent-perbushel increase in the season-average farm price (SAFP) to provide support for a 10- cent increase in the wheat SAFP. o For 2018/19, the U.S. all wheat SAFP is $5.10 per bushel and compares to the newly revised 2017/18 SAFP of $4.75 per bushel. 2

3 Table 1- U.S. wheat supply and utilization at a glance, 2017/18 and 2018/19 Balance sheet item Supply, total Beginning stocks 2017/ /19 (May) 2018/19 (June) Million bushels 2018/19 Change from previous month 1, , , Production 1, , , Imports Supply, total 3, , , Demand Food Seed Feed and residual Domestic, total 1, , , Exports Use, total 1, , , Ending stocks 1, Source: USDA, World Agricultural Outlook Board. 2018/19 Comments May-June Marketing Year (MY) Reduced exports for 2017/18 marketing year lead to a 10- million-bushel increase in carryout, lifts 2018/19 carryin by an equivalent volume. Projected increase in winter wheat yields lifts production by 6 million bushels. Higher beginning stocks and production combine to raise supplies by nearly 17 million bushels. Food use will be reviewed following the August 1 release of the USDA, NASS Flour Milling Products report. Dry conditions in Russia create additional export opportunities for new crop U.S. wheat. Use is raised 25 million on projected export increase. Higher supplies temper reduction in ending stocks attributable to increased exports. Carryout for 2018/19 is projected to be 135 million bushels smaller than for 2017/18. Increasing tightness in the balance sheet supports 10-cent-per-bushel increase in the season-average farm price for all wheat in 2018/19. 3

4 Dry Conditions in the High Plains Notwithstanding, Winter Wheat Production Lifted The USDA, NASS June Crop Production report provides the second survey-based winter wheat production forecast for the 2018/19 marketing year. U.S. winter wheat production is forecast at 1,198 million bushels, up about 6 million bushels month-to-month but down 71 million bushels from The U.S. winter wheat yield is projected at 48.4 bushels per acre, up 0.3 bushels from the May forecast but down 1.8 bushels per acre from the 50.2 farmers realized in Despite the modest aggregate yield increase, lingering drought across a large swath of the High Plains hard red winter (HRW) wheat-growing region is still limiting 2018/19 yields. Year-to-year, yields are down in several key winter wheat-growing States: Colorado (down 3 bushels per acre), Kansas (down 9 bushels per acre), Oklahoma (down 8 bushels per acre), and Texas (down 2 bushels per acre). Collectively, these four States are expected to harvest 53 percent of the 2018 winter wheat crop. The 2018 winter wheat area harvested forecast is unchanged from the May projection of million acres. July s USDA, NASS Crop Production report will include revised projections for winter wheat harvested area and production. Table 2: Winter wheat production by class Winter wheat class 2017/ /19 Change Percent change Million bushels %-- Hard red winter Soft red winter Winter white Source: USDA, National Agricultural Statistics Service, Crop Production. By class, hard red winter (HRW) production is currently projected down 100 million bushels to 650, a 13-percent drop from 2017 on both lower harvested area and yields. Soft red winter (SRW) production is projected up 23 million bushels or 8 percent above the 2017 estimate. A sizable proportion of projected SRW production is grown in Illinois, Ohio, Michigan, and Missouri. These States largely avoided the dryness that has affected much of the HRW growing area. Production of white winter wheat in 2018 is expected to exceed the 2017 harvest by approximately 2 percent. Soft white winter wheat (SWW) production is concentrated in the Pacific Northwest (PNW). For Idaho, the latest PNW Crop Progress and Condition report describes winter wheat in the area as looking good, with a thick stand. In Oregon, the recent cooler temperatures and limited moisture are noted in the same publication to have benefitted the winter wheat crop. In the Idaho, Oregon, and Washington, the proportion of the crop rated good to excellent totaled 81 percent, 74 percent, and 84 percent, respectively. 4

5 2018 HRW SRW HWW SWW Planted area (million acres) Harvested area (million acres) Yield (bushels/acre) Production (million bushels) HRW SRW HWW SWW Planted area (million acres) Harvested area (million acres) Yield (bushels/acre) Production (million bushels) Figure 2: Change in U.S. winter wheat production, 2018 v Source: USDA, National Agricultural Statistics Service QuickStats database. Other Spring Wheat and Durum Production In July, USDA-NASS, will release its first survey-based projection of other spring wheat and durum (not desert) production for the 2018/19 marketing year. Current projections are based on plantings intentions reported in the March Prospective Plantings report and 10-year trend yields and harvested-to-planted ratios. 5

6 Spotlight on North American Grain Transportation Rising grain transportation costs are increasingly being recognized for their role in shaping wheat export prices and reflect challenges associated with trucking shortages, capacity constraints, and rising fuel and rail costs. According to the USDA, Agricultural Marketing Service (AMS) Grain Transportation Report, all forms of grain transportation are more expensive this year. Global economic growth and falling global crude oil inventories support rising crude oil prices. Rising crude oil prices have, in turn, fueled a hike in diesel and bunker fuel costs. Diesel fuel is an important input for the trucking industry, and prices are up 30 cents per gallon, on average, since the beginning of the year. USDA, AMS further reports that diesel prices for May are up 72 cents from the same time a year ago. Higher bunker fuel costs have spurred some ocean container carriers to levy emergency bunker fuel surcharges ranging between $1 and $60 per 20-foot equivalent. A review of reported tariff rail rates for unit and shuttle train shipments of wheat reveals fuel surcharges in excess of $100 per car between Wichita, KS, and St. Louis, MO. Fuel surcharges for wheat shipped between Wichita and the export ports in New Orleans, LA, averaged $178 per car, while surcharges between Amarillo, TX, and Los Angeles, CA, were highest at $271 per car. Tariffs and fuel surcharges combine to add between $1.08 and $1.94 in transportation costs per bushel of wheat. Year-to-year, rail rates are up between 0 percent and 2 percent, on average (fig. 3). Shuttle train rates for wheat are on par to 3 percent higher than 1 year prior. Rates for U.S. bulk wheat shipments to Mexico, inclusive of fuel surcharges, are approximately 1 percent higher year-to-year, whereas surcharges for corn and sorghum range from 2 percent to 5 percent. In March and April, U.S. rail companies notified customers to expect rail rates for wheat to increase to a new record high this summer. Figure 3: U.S. grain transportation, weekly cost index 1/ Truck Unit Barge /03/18 02/03/18 03/03/18 04/03/18 05/03/18 06/03/18 1/ Base year = 2000 Source: USDA, Agricultural Marketing Service Grain Transportation data product. 6

7 Elsewhere in North America, the Canada Transportation Act (Bill C-49), also known as the Transportation Modernization Act, became law on May 23. This multifaceted bill has a stated goal of making grain rail transportation more efficient, primarily by reducing supply chain bottlenecks and moving crops to market more quickly. Rail service is essential to moving grain from the vast rural areas of Canada to coastal export ports and the shared border with the United States. Agri-Food Canada reports that, on average, half of the grain produced in Canada is exported and is valued in excess of 20 billion U.S. dollars. Movement of grains and other commodities is largely facilitated by the Canadian National Railway (CN), which, along with the Canadian Pacific Railway and others, has been criticized for not being able to deliver enough rail cars to meet demand, following a harsh winter and a surge in demand from energy customers. Many thousands of hopper car orders have been cancelled during the 2017/18 marketing year, and industry sources report that a lack of rail cars resulted in some farmers having to wait months before wheat and canola crops could be delivered to elevators for payment. Despite challenges, through week 44 of the 2017/18 marketing year, CN has moved 20.6 million metric tons of bulk Canadian grain, down just slightly from the previous record-setting 2016/17 marketing year. Subsequent to the enactment of Bill C-49, CN announced wide-ranging plans to invest more than $3 billion in 2018 on rail service enhancements. These improvements feature updates such as building 30 additional miles of double track in the busy transcontinental corridor of Alberta, creating a 24/7 situation room to aide in prioritizing rail car movements, purchasing 1,000 nextgeneration grain hopper cars (60 of which are schedule for delivery in 2018), and retrofitting older locomotives. 7

8 International Outlook 2018/19 Foreign Wheat Production Down Global wheat production in 2018/19 is projected to reach million tons, down 3.0 million this month and 13.5 million tons below last year s record. Foreign production is down by 3.2 million tons to million, 15.9 million tons lower than a year ago. The projected decline in global wheat output this month is less than the decline in foreign production, given a 0.2-millionton increase in U.S. production. Foreign wheat area is projected down 1.1 million hectares this month (2.7 million acres; 1 hectare = 2.47 acres) and is 3.0 million hectares lower than last year mainly because of reduced area in Russia and the European Union (EU). Production prospects are revised for three major wheat producers Russia, the EU, and India as well as for Mexico. For more information and a visual display of the changes in wheat output, see map A and table A. Map A Wheat production changes for 2018/19, June 2018 Source: USDA, Foreign Agricultural Service, Production, Supply and Distribution online database. 8

9 Table A - Wheat production changes at a glance (2018/19), June 2018 Country or region Crop year Production Change from previous month 1 YoY 2 change Million tons Comments World Various Foreign Various Russia, EU 3, and Mexico drive down projected wheat output for foreign countries in 2018/19, while an increase in India is partly offsetting. United States June-May See section on U.S. domestic wheat. Russia July-June India Apr-Mar Both winter and spring wheat production are reduced this month. Untimely dry weather persisted in the western primary winter wheat areas (southwest of the country) during flowering stage of crop development. VHI (Vegetation Health Index) is lower than this time in last 2 years and supports yield reduction. In contrast, incessant and freezing rains and unseasonably low temperature significantly delayed planting in the east of Russia Siberia and Urals and spring wheat area is lowered by 1.0 million hectares based on planting reports. Starting this month, the Production, Supply and Distribution online database will be publishing data on spring and winter wheat in Russia, with the series going back to 2000 (see the downloadable data tab). Government procurement, a key indicator of crop size, is running more than 6 percent ahead of last year, and the output is adjusted accordingly. Wheat has already been harvested in India for the 2018/19 crop season. The wheat-growing season was not disrupted by any extreme weather events, and the crop is expected to achieve a trend yield. India has a strong positive wheat yield trend, which supports a projected record of 3.23 tons per hectare for 2018/19. EU 3 July-June Mexico July-June Moldova July-June The change reflects updated European country data. This month, wheat yields and output are projected lower for Germany and Poland, reflecting pronounced dryness across the countries. A declining VHI (Vegetation Health Index), which displays crop stress, is considerably down from last year and supports yield reduction. Wheat area is revised down as low reservoir levels encouraged a shift to less water-consuming plants (chickpeas, oats) or even left fallow. Government statistics support this area change. A revision based on the Government of Moldova estimate. 1 Change from previous month's forecast. 2 YoY: year-over-year changes. 3 EU: European Union. Source: USDA, Foreign Agricultural Service, Production, Supply and Distribution online database. 9

10 Foreign Wheat Use Is Down World wheat use in 2018/19 is projected down 3.0 million tons this month, while U.S. consumption is unchanged. Most of the decline for wheat use is in Russia (down 2.5 million tons, out of which 2.0 million is feed and residual use), the EU (down 1.0 million tons), and Mexico (down 0.1 million tons) as wheat production prospects in all these countries are reduced. An increase of 0.3 million tons in Australian wheat use partly offsets the declines. The Australian Bureau of Statistics (ABS) recently revised the country s wheat output up 1.5 million tons for 2016/17. The revision boosted supplies and, therefore, wheat consumption and stocks estimates for the past 3 years. For additional information on this month s changes in wheat domestic consumption, see map B. Map B Wheat consumption changes for 2018/19, June 2018 Source: USDA, Foreign Agricultural Service, Production, Supply and Distribution online database. Wheat Ending Stocks Projected Higher Global wheat stocks are now projected to increase to million tons, up 1.8 million tons from last month and 6.2 million lower than a year ago. Wheat stocks are boosted this month mainly by an increase in India, where the Government revised its wheat stocks up 1.5 million tons for 2017/18. For the current year, 2018/19, stocks are projected up 1.9 million tons this month as additional wheat is expected to be stocked, given the higher Indian wheat production estimate. An Australian upside revision for 2016/17 output that added 1.5 million tons of production to the country balance also pushed global wheat stocks up. Australian stocks are projected 0.6 million 10

11 tons higher this month. Partly offsetting are reductions in stocks for Russia, down 0.5 million tons, and for several other countries. Stocks in the United States are projected 0.2 million tons lower (see domestic section of this report). Multiple changes in stocks this month result from specific countries production and trade revisions. At-a-glance information for this month s changes in wheat ending stocks is presented in map C. Map C Wheat ending stocks changes for 2018/19, June 2018 Source: USDA, Foreign Agricultural Service, Production, Supply and Distribution online database. Record Wheat Trade for 2018/19 Is Down Marginally Projected record world wheat trade for the international 2018/19 July-June trade year is reduced slightly by 0.8 million tons this month, to million tons. The major drivers for this reduction are sharply lower import prospects for India on the demand side and lower wheat availability in Russia on the supply side. As discussed above, Indian 2018/19 wheat production is projected almost 2 percent higher this month (see table A). To protect farmers income in the face of growing domestic wheat supplies and rising stocks, the Government recently boosted its wheat import tariffs from 20 percent to 30 percent to steer away from cheap imports and keep domestic prices at a high level. The tariff increase will be highly restrictive for Indian wheat imports. India is the world s third-largest wheat producer, and fluctuations in its output, along with the Government s changing support policies, can create shifts in world trade as the country periodically turns from being a nontrivial wheat exporter to a large importer. Indian wheat imports are reduced 1.5 million tons this month to 0.5 million (fig. 1). 11

12 Figure 1: Cyclical nature of Indian net wheat imports, Million tons f Note: Positive values indicate imports; negative values are exports. f = forecast. Source: USDA, Foreign Agricultural Service, Production, Supply and Distribution online database. For a short overview of changes in specific countries imports, see Grain: World Markets and Trade, p.5, issued by USDA s Foreign Agricultural Service on June 12, Projected 2018/19 wheat exports by Russia are reduced 1.5 million tons this month to 35.0 million, due to expected lower production of winter wheat in the southern part of the country. By virtue of being close to ports, this region is by far Russia s main exporting territory and is often considered a barometer for the export outlook for Russian wheat. Although exports are projected lower, Russia is expected to remain the world s dominant wheat exporter, far ahead of the country s main export competitors. Tighter supplies and reduced competition from Russia are expected to support the export prospects of its main competitors. Even with reduced wheat supplies, the European Union is not expected to export less wheat. Its projection remains unchanged this month at 29.0 million tons. For 2018/19, reduced foreign wheat supplies and strong global demand are expected to boost U.S. exports 1.0 million tons to 26.0 million. For visual information on this month s changes in 2018/19 wheat exports, see map D. 12

13 Map D Wheat exports changes for 2018/19, June 2018 Source: USDA, Foreign Agricultural Service, Production, Supply and Distribution online database. For 2017/18, U.S Exports Projected Down Additional changes in wheat exports for the 2017/18 trade year that ends in June 2018 involve largely offsetting modifications. Russian exports are raised, up 1.0 million tons to 40.5 million (as of the end of May, Russia reportedly exported more than 38.0 million tons, and its export pace continues to be strong). The increase is partly offset by reductions for Argentina and the United States. The U.S. wheat export forecast for the 2017/18 July-June trade year is reduced 0.5 million tons to 23.5 million (down 15 million bushels, to 1,010 million, for the June-May marketing year). The slow pace of shipments in May supports this reduction. Census data from July through April 2018 indicate that wheat grain shipments reached 19.1 million tons, while May 2018 wheat inspections were 1.8 million tons. Given that flour and product exports on a wheat-equivalent basis are expected to be about 0.6 million tons for the year, June 2018 exports would have to reach only 2.0 million tons to fulfill the forecast. 13

14 Figure 1 All wheat average prices received by farmers Dollars per bushel / / /18 June July Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May Market year Source: USDA, National Agricultural Statistics Service, Agricultural Prices. Figure 2 Hard red winter wheat average prices received by farmers Dollars per bushel / / /18 June July Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May Market year Source: USDA, National Agricultural Statistics Service, Agricultural Prices. Figure 3 Dollars per bushel / / / June July Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May Market year Source: USDA, National Agricultural Statistics Service, Agricultural Prices. 14

15 Figure 4 Soft red winter wheat average prices received by farmers Dollars per bushel / / /18 June July Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May Market year Source: USDA, National Agricultural Statistics Service, Agricultural Prices. Figure 5 Soft white wheat average prices received by farmers Dollars per bushel / / / June July Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May Market year Source: USDA, National Agricultural Statistics Service, Agricultural Prices. Figure 6 Dollars per bushel / / /18 June July Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May Market year Source: USDA, National Agricultural Statistics Service, Agricultural Prices. 15

16 Figure 7 All wheat: U.S. supply and disappearance change from prior market year Million bushels Beginning stocks Imports Production Supply Domestic use Exports Total disappearance Ending stocks Source: USDA, World Agricultural Outlook Board, World Agricultural Supply and Demand Estimates. Figure 8 Hard red winter wheat: U.S. supply and disappearance change from prior market year Million bushels Beginning stocks Imports Production Supply Domestic use Exports Total disappearance Ending stocks Source: USDA, World Agricultural Outlook Board, World Agricultural Supply and Demand Estimates. Figure 9 Hard red spring wheat: U.S. supply and disappearance change from prior market year Million bushels Beginning stocks Imports Production Supply Domestic use Exports Total disappearance Ending stocks Source: USDA, World Agricultural Outlook Board, World Agricultural Supply and Demand Estimates. 16

17 Figure 10 Soft red winter wheat: U.S. supply and disappearance change from prior market year Million bushels Beginning stocks Imports Production Supply Domestic use Exports Total disappearance Ending stocks Source: USDA, World Agricultural Outlook Board, World Agricultural Supply and Demand Estimates. Figure 11 White wheat: U.S. supply and disappearance change from prior market year Million bushels Beginning stocks Imports Production Supply Domestic use Exports Total disappearance Ending stocks Source: USDA, World Agricultural Outlook Board, World Agricultural Supply and Demand Estimates. Figure 12 Durum: U.S. supply and disappearance change from prior market year Million bushels Beginning stocks Imports Production Supply Domestic use Exports Total disappearance Ending stocks Source: USDA, World Agricultural Outlook Board, World Agricultural Supply and Demand Estimates. 17

18 Table 1--Wheat: U.S. market year supply and disappearance, 6/14/2018 Item and unit 2012/ / / / / / /19 Area: Planted Million acres Harvested Million acres Yield Bushels per acre Supply: Beginning stocks Million bushels , ,080.2 Production Million bushels 2, , , , , , ,827.5 Imports ¹ Million bushels Total supply Million bushels 3, , , , , , ,042.7 Disappearance: Food use Million bushels Seed use Million bushels Feed and residual use Million bushels Total domestic use Million bushels 1, , , , , , ,147.0 Exports ¹ Million bushels 1, , , Total disappearance Million bushels 2, , , , , , ,097.0 Ending stocks Million bushels , , CCC inventory Million bushels.0 Stocks-to-use ratio Loan rate Dollars per bushel Contract/direct payment rate Dollars per bushel Farm price ² Dollars per bushel Market value of production Million dollars 17,383 14,604 11,915 10,203 8,981 8,268 9,320 Latest market year is projected; previous market year is estimated. Totals may not add due to rounding. ¹ Includes flour and selected other products expressed in grain-equivalent bushels. ² U.S. season-average price based on monthly prices weighted by monthly marketings. Prices do not include an allowance for loans outstanding and government purchases. Source: USDA, World Agricultural Outlook Board, World Agricultural Supply and Demand Estimates and supporting materials. Date run: 6/13/

19 Table 2--Wheat by class: U.S. market year supply and disappearance, 6/14/2018 Hard red Market year, item, and unit All wheat winter¹ Hard red spring¹ Soft red winter¹ White¹ Durum 2017/18 Area: Planted acreage Million acres Harvested acreage Million acres Yield Bushels per acre Supply: Beginning stocks Million bushels 1, Production Million bushels 1, Imports² Million bushels Total supply Million bushels 3, , Disappearance: Food use Million bushels Seed use Million bushels Feed and residual use Million bushels Total domestic use Million bushels 1, Exports² Million bushels Total disappearance Million bushels 1, Ending stocks Million bushels 1, /19 Supply: Beginning stocks Million bushels 1, Production Million bushels 1, Imports² Million bushels Total supply Million bushels 3, , Disappearance: Food use Million bushels Seed use Million bushels Feed and residual use Million bushels Total domestic use Million bushels 1, Exports² Million bushels Total disappearance Million bushels 2, Ending stocks Million bushels Latest market year is projected; previous market year is estimated. Totals may not add due to rounding. ¹ Area and yield data are unpublished National Agricultural Statistics Service data. Supply and disappearance data, except production, are approximations. ² Includes flour and selected other products expressed in grain-equivalent bushels. Source: USDA, National Agricultural Statistics Service, Crop Production and unpublished data; and USDA, World Agricultural Outlook Board, World Agricultural Supply and Demand Estimates and supporting materials. Date run: 6/13/

20 Table 3--Wheat: U.S. quarterly supply and disappearance (million bushels), 6/14/2018 Market year and quarter Production Imports¹ Total supply Food use Seed use Feed and residual use Exports¹ Ending stocks 2010/11 Jun-Aug 2, , ,450 Sep-Nov 24 2, ,933 Dec-Feb 23 1, ,425 Mar-May 22 1, Mkt. year 2, , , /12 Jun-Aug 1, , ,147 Sep-Nov 32 2, ,663 Dec-Feb 30 1, ,199 Mar-May 30 1, Mkt. year 1, , , /13 Jun-Aug 2, , ,115 Sep-Nov 33 2, ,671 Dec-Feb 35 1, ,235 Mar-May 31 1, Mkt. year 2, , , /14 Jun-Aug 2, , ,870 Sep-Nov 48 1, ,475 Dec-Feb 42 1, ,057 Mar-May 47 1, Mkt. year 2, , , /15 Jun-Aug 2, , ,907 Sep-Nov 35 1, ,530 Dec-Feb 37 1, ,140 Mar-May 36 1, Mkt. year 2, , /16 Jun-Aug 2, , ,097 Sep-Nov 27 2, ,746 Dec-Feb 34 1, ,372 Mar-May 25 1, Mkt. year 2, , /17 Jun-Aug 2, , ,545 Sep-Nov 30 2, ,079 Dec-Feb 25 2, ,659 Mar-May 31 1, ,181 Mkt. year 2, , ,055 1, /18 Jun-Aug 1, , ,266 Sep-Nov 36 2, ,873 Dec-Feb 37 1, ,494 Mkt. year 1, , , /19 Mkt. year 1, , Latest market year is projected; previous market year is estimated. Totals may not add due to rounding. ¹ Includes flour and selected other products expressed in grain-equivalent bushels. Source: USDA, World Agricultural Outlook Board, World Agricultural Supply and Demand Estimates and supporting materials. Date run: 6/13/

21 Table 4--Wheat: Monthly food disappearance estimates (1,000 grain-equivalent bushels), 6/14/2018 Mkt year and Wheat ground for + Food imports² + Nonmilled food use³ - Food exports² = Food use month 1/ flour 2016/17 Jun 73,149 2,933 2,000 2,150 75,932 Jul 74,237 2,639 2,000 1,665 77,212 Aug 81,136 3,198 2,000 1,856 84,478 Sep 78,018 2,537 2,000 2,140 80,415 Oct 81,469 2,968 2,000 2,325 84,111 Nov 77,978 3,191 2,000 2,201 80,968 Dec 73,195 2,863 2,000 1,868 76,190 Jan 73,561 2,858 2,000 2,027 76,392 Feb 72,977 2,301 2,000 1,978 75,300 Mar 77,425 2,840 2,000 1,789 80,477 Apr 74,812 2,828 2,000 1,534 78,105 May 76,492 2,818 2,000 1,914 79, /18 Jun 73,183 3,248 2,000 1,822 76,610 Jul 74,520 2,966 2,000 1,795 77,691 Aug 81,444 3,151 2,000 2,107 84,488 Sep 78,315 2,622 2,000 1,411 81,526 Oct 82,325 3,243 2,000 1,133 86,434 Nov 78,798 3,219 2,000 1,285 82,732 Dec 73,964 2,941 2,000 1,563 77,341 Jan 74,607 3,075 2,000 1,423 78,259 Feb 74,014 2,948 2,000 1,589 77,374 Mar 78,526 3,197 2,000 1,571 82,152 Apr 3,259 1,432 1,826 ¹ Current year is preliminary. Previous year is preliminary through August of current year, estimated afterwards. ² Food imports and exports used to calculate total food use. Includes all categories of wheat flour, semolina, bulgur, and couscous and selected categories of pasta. ³ Wheat prepared for food use by processes other than milling. Estimated food use equals wheat ground for flour plus food imports plus nonmilled food use minus food exports. See for more information. Source: Data through the 2nd quarter of 2011 was calculated using data from U.S. Department of Commerce, Bureau of the Census Flour Milling Products (MQ311A) and U.S. Department of Commerce, Bureau of Economic Analysis Foreign Trade Statistics. Subsequent flour milling calculations are based on data from the North American Millers Association. Date run: 6/13/

22 Table 5--Wheat: National average price received by farmers (dollars per bushel), 6/14/2018 Month All wheat Winter Durum Other spring 2016/ / / / / / / /18 June July August September October November December January February March April May Source: USDA, National Agricultural Statistics Service, Agricultural Prices. Table 6--Wheat: National average prices received by farmers by class (dollars per bushel), 6/14/2018 Month Hard red winter Soft red winter Hard red spring White 2016/ / / / / / / /18 June July August September October November December January February March April May Source: USDA, National Agricultural Statistics Service, Agricultural Prices. Date run: 6/13/

23 Table 7--Wheat: Average cash grain bids at principal markets, 6/14/2018 No. 1 hard red winter No. 1 hard red winter (ordinary protein) (13% protein) Kansas City, MO Kansas City, MO (dollars per bushel) (dollars per bushel) No. 1 hard red winter (ordinary protein) Portland, OR (dollars per bushel) No. 1 hard red winter (ordinary protein) Texas Gulf, TX ¹ (dollars per metric ton) Month 2016/ / / / / / / /18 June July August September October November December January February March April May No. 1 dark northern spring No. 1 dark northern spring No. 1 dark northern spring No. 1 hard amber durum (13% protein) (14% protein) (14% protein) Minneapolis, MN Chicago, IL Chicago, IL Portland, OR (dollars per bushel) (dollars per bushel) (dollars per bushel) (dollars per bushel) 2016/ / / / / / / /18 June July August September October November December January February March April May No. 2 soft red winter St. Louis, MO (dollars per bushel) No. 2 soft red winter Chicago, IL (dollars per bushel) No. 2 soft red winter Toledo, OH (dollars per bushel) No. 1 soft white Portland, OR (dollars per bushel) 2016/ / / / / / / /18 June July August September October November December January February March April May = Not available or no quote. ¹ Free on board. Source: USDA, Agricultural Marketing Service, State Grain Reports, template=templates&navid=marketnewsandtransportationdata&leftnav=marketnewsandtransportationdata&page=lsmarketnewspa gestategrainreports. Date run: 6/13/

24 Table 8--Wheat: U.S. exports and imports for last 6 months (1,000 bushels), 6/14/2018 Nov Dec Jan Feb Mar Apr Item Exports All wheat grain 51,641 79,137 65,821 51,423 78,069 71,212 All wheat flour¹ 866 1, ,094 1,157 1,088 All wheat products² Total all wheat 52,942 80,776 67,258 53,040 79,682 72,673 Imports All wheat grain 9,640 9,389 9,775 9,137 10,243 11,567 All wheat flour¹ 1,499 1,253 1,446 1,301 1,547 1,454 All wheat products² 1,777 1,720 1,680 1,657 1,676 1,828 Total all wheat 12,915 12,362 12,901 12,095 13,466 14,848 Totals may not add due to rounding. ¹ Expressed in grain-equivalent bushels. Includes meal, groats, and durum. ² Expressed in grain-equivalent bushels. Includes bulgur, couscous, and selected categories of pasta. Source: U.S. Department of Commerce, U.S. Census Bureau, Foreign Trade Statistics; and ERS calculations using Census trade statistics. Date run: 6/13/

25 Suggested Citation Bond, Jennifer K. and Olga Liefert., Wheat Outlook, WHS-18f, U.S. Department of Agriculture, Economic Research Service, June 14,

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