Peter McMeekin this week comments on the disparity between USDA optimistic predictions of Australia’s winter crop and the expectations of market participants as frost damaged crops across Australia and drought hit winter yield prospects in most of the Murray Darling Basin.
The USDA has cut its forecast for Australian wheat production to 18.5 million tonnes, down 1.5Mt from its previous estimate, in its October World Agricultural Supply and Demand Estimates Report released overnight.
Peter McMeekin this week foreshadows continued upward pressure on world wheat prices as Middle East and North Africa buyers continue to book business at higher levels. Haymakers in Australia taking their cue from the drought-driven hay price, while SA/Vic crop potential gets cut.
Record yields are on the cards for the US summer crops of corn and soybeans. Corn recently began an earlier-than-usual harvest in the US mid-west.
The USDA has estimated Australia’s coming wheat crop at 22 million tonnes, in line with ABARES’ most recent projection, but around 3Mt above industry expectations.
The USDA and ABARES released updates for their relevant papers on crop production this week, sparking up markets as the July CBOT wheat contract traded at US52c/bu weekly range (A$27/t) and ended closing lower at 499.50c/bu.
Brazil displaced the US as the world’s biggest soybean exporter in 2013/14, and is banking the windfall of not only big crops but also dramatically depreciating currency to maintain its top ranking among world soybean exporters, says USDA.
North Africa and the Middle East regions have been supplanted by rising wheat demand in Southeast Asia and Sub-Saharan Africa to become the world’s major import destinations for wheat trade.
Global cotton production for 2018/19 is forecast to be lower, with declines for China, Pakistan, and Australia partially offset by an increase for Brazil, according to the latest monthly report from the United States Department of Agriculture.
Russia is forecast to ship 35 million tonnes (Mt) of wheat in 2018/19 to retain its position as the world’s largest exporter of wheat, according to the United States Department of Agriculture (USDA) June 2018 World Agricultural Supply and Demand Estimates (WASDE) report.