MARKET reaction to USDA’s March World Agricultural Supply and Demand Estimates report was limited in overnight trading, with a 3-million-tonne (Mt) increase in its estimate for Australia’s 2020-21 wheat crop the biggest production change.
“All commodities take out a neutral to bearish report, with the market looking for some slight reductions in beans and corn carry-outs again, which they were disappointed they didn’t get,” Lachstock Consulting said in its WASDE commentary.
“The USDA kicked the can down the road on demand for all crops, with ending stocks unchanged for wheat, corn, and soybeans,” Lachstock Consulting said in today’s market wire in response to WASDE’s US numbers.
USDA’s lifted its Australian wheat production estimate 3Mt to 33Mt, in line with ABARES, and its global wheat production estimate by 3.3Mt to a record 776.8Mt.
Offsetting this was a 3Mt cut to global wheat ending stocks to 301.2Mt, while the forecast for Russian wheat exports at 39Mt is unchanged.
Wheat production estimates for major producers were unchanged, with Argentina on 17.2Mt, Canada on 35.2Mt, the European Union on 135.8Mt, Russia on 85.4Mt, Ukraine on 25.5Mt and the US at 49.7Mt.
The estimate for global wheat trade has risen 2.9Mt to a record 197.7Mt, mostly on higher exports by Australia and Canada.
These are now seen at 22Mt for Australia, up 2Mt from the February number, and 27Mt for Canada, up 500,000t on the month.
“Australia’s exports are raised on greater exportable supplies, while Canada’s exports are increased on a continued strong pace,” USDA said in its commentary.
Barley is Australia’s biggest coarse grain export by far, with sorghum and corn contributing a small portion.
USDA has lifted its forecast for Australia’s 2020-21 coarse-grain exports to 7Mt from 6Mt seen last month.
USDA adjusted its China wheat numbers, with imports up 500,000t to 10.5Mt, ending stocks down 4.5Mt to 150.4Mt, and its estimate for feed and residual wheat usage is up 5Mt to a record 35Mt.
The estimate for China’s corn imports is unchanged at 24Mt.
On soybeans, the estimate for China’s imports is steady at 100Mt, while production has been cut by 500,000t for Argentina, now at 47.5Mt, but lifted 1Mt to 134Mt for Brazil.
“In a word: boring,” Lachstock said.
“They made a few minor tweaks on by-class wheat allocations, but otherwise it was all about pushing forward until they get the March stocks report and hoping that the demand will solve itself.”
The US stocks report will be released on 31 March.