US Wheat has export opportunity brewing

Washington—Despite a rise in global wheat production, there are also reported declines in major European wheat-producing nations. That could give US wheat exports a boost. 

The US wheat production forecast numbers are up from last month and up from the previous month. But that did not offset an almost 3 1/2-percent adjustment down in world wheat production, that’s according to Acting World Agricultural Outlook Board Chairman Mark Jekanowski.

“We’re seeing a decrease in production in the European Union and in Russia as well. Then as we think about spring wheat crop, many of our major competitors across Europe particularly Russia and Siberia. Their yields are down. Harvest has started and it’s very hot and dry so we are decreasing yield and projection estimates there as well,” said Jekanowski.

And while there’s still expected to be a year-over-year increase in global wheat production, Jekanowski says lower production in the former Soviet Union states is positive for US farmers.

“It's definitely a positive note for US exports prospects,” said Jekanowski. “We’re showing this first crop year, a 25-million bushel increase in exports. Any trimming in foreign production should help improve US competitiveness.”

According to the USDA, recent wheat export sales and inspections look encouraging and justifies the Department's decision this summer to boost this year’s wheat export projection by 50-million bushels to 950 mb.

Marketers say If you look at past sales for this time of the year, especially in terms of the percent of the latest WASDE projection, it shows the numbers are not out of the ordinary. They say that wheat sales look strong compared to the slow pace of corn and soybean exports.