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December 22, 2015
Grain Market Outlook
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I‐E. U.S. Wheat Production
U.S. Wheat Planted Acreage
Beginning with the September 30, 2015 USDA National Agricultural Statistics Service (NASS) Small Grains
2015 Summary report and following with its’ subsequent October 9th, November 10th, and December 9th USDA
NASS 2015 Crop Production reports, the USDA has projected that 2015 U.S. wheat total planted acreage is
54.644 million acres (ma), down 2.178 ma (‐3.8%) from 56.822 ma in 2014, down 1.592 ma (‐2.8%) from
56.236 ma in 2013, and down from 55.294 ma in 2012, but still up from 54.277 ma in 2011, and the 6 year low
of 52.620 ma in 2010 (Table 1 and Figures 4 and 5).
Winter Wheat Planted Acres: In the December 9th NASS Crop Production report the USDA left unchanged
its previous October‐November forecast of 2015 U.S. winter wheat plantings of 39.461 ma, down 2.948 ma (‐
7.0%) from 42.409 ma in 2014, and down 3.769 ma (‐8.7%) from 43.230 ma in 2013. Of this total, 28.98 ma
are projected to have been seeded to Hard Red Winter (HRW) wheat in 2015, down 5% from 30.50 ma in
2014, and down 2.3% from 29.67 ma in 2013. Soft Red Winter (SRW) wheat planted acreage is projected at
7.09 ma, down 16.4% from 8.48 ma in 2014, and down 29.4% from 10.04 ma in 2013. For 2015, USDA projects
there to be 4.130 ma of All White Wheat planted, with 3.396 ma of winter white (WW) wheat (down from
3.427 ma in 2014), and 734,000 acres of spring white (SW) wheat (down from 778,000 acres in 2014).
Other Spring Wheat Planted Acres: In December the USDA also left unchanged it’s previous October‐
November projections of total U.S. other spring wheat plantings in 2015 to be 13.247 ma, up 222,000 acres
(+1.7%) from 13.025 ma in 2014, and up 1.641 ma (+14.1%) from 11.606 ma in 2013. Of this total, 12.51 ma
are seeded to Hard Red Spring (HRS) wheat, up from 12.25 ma in 2014, and from 10.94 ma in 2013.
Durum Wheat Planted Acres: Durum wheat plantings in the U.S. in 2015 are still projected by the USDA
at 1.936 ma in 2015, up 529,000 acres (+37.6%) from 1.407 ma in 2014, and up 536,000 acres (+38.3%) from
1.400 ma in 2013.
U.S. Wheat Harvested Acreage
Also beginning in the September 30, 2015 USDA Small Grains 2015 Summary report and subsequent
October, November, and December USDA NASS 2015 Crop Production reports the USDA has projected that
2015 U.S. wheat total harvested acreage is 47.094 million acres (ma), up 709,000 acres (+1.5%) from 46.385
ma in 2014, and up 1.762 ma (+3.9%) from 45.332 ma in 2013, while down from 48.758 ma in 2012, and up
from 45.687 ma in 2011 (Table 1 and Figures 4 and 5).
Aggregated total U.S. percent harvested‐to‐planted acreage was estimated to be 86.2% in 2015, up from
81.6% in 2014, 80.6% in 2013, and comparable to the range of 76.0%‐89.1% (average = 84.1%) over the 2000‐
2014 period (Table 1 and Figure 5). The proportion of harvested‐to‐planted U.S. wheat acreage in 2013 of
80.6% was the 4th lowest during this period, behind 76.0% in 2002 and 81.6% in 2006 and 2014.
Winter Wheat Harvested Acres: In December the USDA maintained its previous October‐November
forecasts of 2015 U.S. winter wheat harvested acreage at 33.257 ma, down 42,000 acres (‐0.1%) from 32.299
ma in 2014, down 393,000 acres (‐1.2%) from 32.650 ma in 2013, and down 2.352 ma (‐6.8%) from 34.609 ma
in 2012. Of this total, 23.14 ma were projected to be Hard Red Winter (HRW) wheat in 2015, up 5.6% from
21.92 ma in 2014, and up from 20.39 ma in 2013. Soft Red Winter (SRW) wheat harvested acreage was
projected to be 5.89 ma, down 17.7% from 7.16 ma in 2014, and down 34.0% from 8.92 ma in 2013. For 2015,
Page | 6
USDA projects there to be 3.939 ma of All White Wheat harvested, with 3.221 ma of white winter (WW)
wheat (down marginally from 3.219 ma in 2014), and 718,000 acres of spring white (SW) wheat (down 4.0%
from 748,000 acres in 2014).
Other Spring Wheat Harvested Acres: The USDA also maintained it’s October‐November projections that
total U.S. other spring wheat harvested area in 2015 is 12.941 ma – down 276,000 acres from it’s previous
forecast. This projection of 12.941 ma of 2015 U.S. other spring wheat harvested acres is up 201,000 acres
(+1.6%) from 12.740 ma in 2014, and up 1.597 ma (+14.1%) from 11.344 ma in 2013. Of this total, 12.22 ma
are Hard Red Spring (HRS) wheat, up from 11.99 ma in 2014, and from 10.70 ma in 2013.
Durum Wheat Harvested Acres: Durum wheat harvested area in the U.S. in 2015 are projected by the
USDA to be 1.896 ma in 2015, but up 555,000 acres (+40.9%) from 1.338 ma in 2014, and up 558,000 acres
(+41.7%) from 1.338 ma in 2013.
U.S. Wheat Yields & Production
In the December 9, 2015 USDA NASS Crop Production report the USDA maintained it’s October‐November
projections of 2015 U.S. average wheat yields to be 43.6 bushels per acre (bu/ac) – down from projections of
44.1 bu/ac in August‐September, and 44.3 bu/ac in July, but up from 43.5 bu/ac in May 2015. This projection
of 2015 U.S. wheat yields of 43.6 bu/ac is down from 43.7 bu/ac in 2014, but less than the record high of 47.1
bu/ac in 2013, and the previous record high of 46.2 bu/ac in 2012 (Table 1 and Figure 6).
Based on this combination of projections for 2015 planted acreage (54.644 ma), harvested acreage (47.094
ma), and yield (43.6 bu/ac), 2015 U.S. wheat production continues to be projected at 2.052 billion bushels
(bb). This projection of 2015 U.S. wheat production of 2.052 bb is up from 2.026 bb in 2014, and within the
2004‐2014 range of 1.808‐2.512 bb (average = 2.128 bb, median = 2.135 bb) (Table 1 and Figure 7).
I‐F. U.S. Wheat Total Supplies
Total supplies of U.S. wheat of 2.930 bb for “new crop” MY 2015/16 projected by the USDA in December
are unchanged from October‐November, but down 84 mb from the September WASDE report, resulting from
beginning stocks of 753 mb, projected 2015 production of 2.052 bb, and projected imports of 125 mb (Table 1
and Figure 7). Over the last ten (10) marketing years, U.S. wheat total supplies have been 2.501 bb in MY
2006/07, 2.620 bb in MY 2007/08, 2.945 bb in MY 2008/09, 2.984 bb in MY 2009/10, 3.236 bb in MY 2010/11,
2.969 bb in MY 2011/12, 3.119 bb in MY 2012/13, 3.026 bb in MY 2013/14, 2.766 bb in MY 2014/15, and are
now projected to be 2.930 bb in “new crop” MY 2015/16.
Forecast U.S. wheat beginning stocks of 753 mb in “new crop” MY 2015/16 are up 27.6% from 590 mb in
beginning stocks in “old crop” MY 2014/15, and up from 718 mb in MY 2013/14. This projection of 753 mb in
beginning stocks in “new crop” MY 2015/16 is more than double the long term historic low of 306 mb in MY
2008/09 – which resulted from the historically tight U.S. wheat ending stocks situation that occurred in MY
2007/08.
Projected U.S. wheat imports of 125 mb for “new crop” MY 2015/16 are less than 149 mb in “old crop” MY
2014/15 (the 2nd highest on record), and the record high of 173 mb in MY 2013/14. Since MY 1973/74 and
prior to MY 2013/14, the next highest amounts of U.S. wheat imports have been: 1) 127 mb in MY 2008/09; 2)
124 mb in MY 2012/13; 3) 122 mb in MY 2006/07; and 4) 119 mb in MY 2009/10.
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Nearly all of U.S. wheat imports come from Canada because of favorable geographic location and
associated grain transportation logistics. Large Canadian wheat supplies over the last several years have been
a major factor in this increase in U.S. wheat imports. Canada produced a record large wheat crop of 37.53
million metric tons (mmt) (or 1.379 bb in 60 lb/bu units) in MY 2013/14, followed by a crop of 29.42 mmt
(1.081 bb) in MY 2014/15, with a projection of 27.6 mmt (1,014 bb) in “new crop” MY 2015/16. The largest
Canadian wheat crops since 1960 that were over 30.0 mmt happened in 1986 (31.4 mmt or 1.152 bb), 1990
(32.1 mmt or 1.179 bb), 1991 (31.9 mmt or 1.174 bb), and 2013 (37.5 mmt or 1.379 bb).
I‐G. U.S. Wheat Total Use & Use by Category
Food Use: Projected U.S. wheat food use of 967 mb in “new crop” MY 2015/16 follows a consistent
upward trend over time due to a) steady growth in the U.S. population, and b) associated regular increases in
domestic demand for processed wheat products. This projected amount of 967 mb in food use in “new crop”
MY 2015/16 follows 958 mb in MY 2014/15, 955 mb in MY 2013/14, and 951 mb in MY 2012/13 (Table 1 and
Figure 8).
Seed Use: Forecast seed use of 72 mb in “new crop” MY 2015/16 is down from 81 mb in “old crop” MY
2014/15, 77 mb in MY 2013/14, and 73 mb in MY 2012/13 (Table 1 and Figure 8). The USDA’s forecast of U.S.
wheat seed use extends the historic pattern of there being a relatively small but inelastic demand for U.S.
wheat for seed use purposes. Seed demand is driven primarily by the amount of U.S. wheat seed needed to
plant adequate U.S. wheat acreage each year (from both commercial and on‐farm seed sources) with
consideration for the risk of possible shortfalls in annual seed wheat production.
Exports: Projected U.S. wheat exports of 800 mb in “new crop” MY 2015/16 in December are unchanged
from November, but down 50 mb from October, down 100 mb from September, 125 mb from August, and 150
mb from July. This projection of 800 mb in U.S. wheat exports in “new crop” MY 2015/16 is down 6.3% from
854 mb in “old crop” MY 2014/15, and is down to the lowest amount in 45 years, i.e., since 610 mb in MY
1971/72 prior to the “Russian Grain Deal” period of MY 1973/74 (Table 1 and Figure 8). Over the last ten (10)
marketing years, the U.S. has exported 908 mb of wheat in MY 2006/07, 1.263 bb in MY 2007/08, 1.015 bb in
MY 2008/09, 879 mb in MY 2009/10, 1.291 bb in MY 2010/11, 1.051 bb in MY 2011/12, 1.012 bb in MY
2012/13, 1.176 bb in MY 2013/14, an estimate of 854 mb in “old crop” MY 2014/15, and now a projection of
800 mb in “new crop” MY 2015/16.
Some of the factors that have caused lower U.S. wheat exports in “old crop” MY 2014/15 and “new crop”
MY 2015/16 are a) the sharp increase in the value of the U.S. dollar relative to other World currencies, and b)
prospects for fully adequate supplies of competitive foreign wheat stockpiles for export trade purposes. That
said, there are several factors that could change the current “low export demand” situation for the United
States, including 1) the uncertain impact on World wheat trade in the future from ongoing geopolitical
conflicts – such as those between Russian and Ukraine and also in the broader Middle East, and 2) the
potential for dry or adverse weather conditions in other major World wheat production areas due to the
likelihood of an “El Nino” or an “El Nino transition to a La Nina” weather pattern in the spring and/or summer
of 2016. However, until tangible evidence of such potential damage to foreign wheat production and/or other
market events should occur in late 201 …
July 18, 2012
Energy
have increased sharply since 2005/06 ............................5
Figure … consumption began declining in 2005 in response to the higher … required cuts in use in the event of short-crop conditions.
Livestock …
July 18, 2012
Cash Prices & Marketing Strategies
have increased sharply since 2005/06 ............................5
Figure … consumption began declining in 2005 in response to the higher … required cuts in use in the event of short-crop conditions.
Livestock …
August 1, 2025
Breakout Sessions
December 30, 2016
Grain Market Outlook
rd high 252.1 mmt up from
240.65 mmt last year, and 217.2 mmt two years ago, and 4) World wheat percent ending stocks‐to‐use (S/U) of
34.1% ‐ up from 33.8% last year, and from 30.8% two years ago – up to the highest level since MY 2005/06.
For a perspective on how historically large World total wheat stocks and World wheat percent stocks‐to‐use
now are, in MY 2007/08 the 34‐year low in World wheat ending stocks of 128.1 mmt and at least a 57‐year low
in percent ending stocks‐to‐use of 20.75% stocks/use both occurred – the last major World wheat “short crop”
marketing year. The situation in MY 2007/08 compares to projections of 252.1 mmt ending stocks and 34.1%
ending stocks‐to‐use projected for “current” MY 2016/17. The “large crop‐over supply” situation that now
exists in World and U.S. wheat markets continues to have a strong prevailing negative influence on U.S. and
World wheat prices.
However, the broader large crop‐over supply‐low price” situation in the World wheat market may be “hiding”
at least a couple of other important market issues. First, while the quantity of wheat available in the World is
plentiful, the available supply of high protein milling wheat is less so. This factor may eventually help exports
of both U.S. Hard Red Spring (HRS) wheat (higher protein – good quality) and U.S. Hard Red Winter (HRW)
wheat (moderate protein – good quality) relative to World wheat export competitors. As evidence of this,
exports of U.S. HRW wheat have been occurring at the pace needed to meet USDA projections – helped by
both low purchase prices and acceptable protein and quality. This raises the outside possibility of improved
U.S. HRW prices in coming months. Second, while the supply of wheat in World markets overall has grown,
the supply of wheat in the “World Less China” is projected to have actually “contracted” or “diminished” in
“current crop” MY 2016/17 compared to a year ago – down to the tightest supply‐balances situation since MY
2013/14. If this “China factor” eventually leads to noticeably tighter available global supplies of exportable
wheat to occur in coming months, it could have a positive impact U.S. wheat market prices in Spring 2017.
Even so, given the broader World wheat market’s current focus – it is likely that significant World wheat
production problems and/or trade disruptions would need to occur in year 2017 in order to have wheat prices
recover significantly by spring‐summer 2017. Ongoing strength in the U.S. dollar exchange rate is a serious
negative factor that is limiting the competitive affordability of U.S. wheat exports. These factors have resulted
in higher U.S. wheat ending stocks and % ending stocks‐to‐use, and have caused U.S. and Kansas wheat cash
prices to fall sharply – down to and below the marketing loan rate in most of Kansas in fall / early winter 2016.
Page | 2
USDA U.S. Wheat Supply/Demand Forecast for “Next Crop” MY 2017/18: On December 1, 2016 the USDA
released their preliminary Long Term Agricultural Projections to 2026, in which they projected 2017 U.S.
wheat plantings of 48.500 million acres (ma) – down from 50.154 ma in 2015. The USDA also forecast 2016
harvested acres of 41.100 ma which would be down from 43.890 ma a year ago. Trendline 2017 wheat yields
for 2017 are projected at 47.1 bu/a, down from the 2016 record of 52.6 bu/ac, while 2017 U.S. wheat
production is forecast to be 1.936 billion bushels (bb), down from 2.310 bb in 2015. Projected “next crop” MY
2017/18 total supplies are 3.199 bb (down from 3.410 bb in “current” MY 2016/17), with total use of 2.206 bb
(down from 2.267 bb in “current” MY 2016/17).
Given these numbers, the USDA projected “next crop” MY 2017/18 ending stocks of 933 million bushels (mb)
(vs 1.143 bb a year ago), with percent ending stocks‐to‐use of 45.0% S/U (vs 50.4% last year and 50.0% the
previous year). United States wheat average prices are projected to average $4.00 /bu – up from $3.70 in
“current” MY 2016/17, but down from $4.89 /bu in MY 2015/16 and $5.99 /bu in MY 2014/15. It is assumed
by Kansas State University that these USDA projections for “next crop” MY 2016/17 have a 50% probability of
occurring.
Three Alternative KSU U.S. Wheat S/D Forecast for “Next Crop” MY 2017/18: As an alternative to the USDA’s
projection, three potential KSU‐Scenarios for U.S. wheat supply‐demand and prices are presented for “next
crop” MY 2017/18. These scenarios assume lower 2017 U.S. planted (47.624 ma) and harvested (38.385 ma)
wheat acres than the USDA – due to larger than normal amounts of “graze out” and “crop switching” in 2017.
KSU Scenario 1) “Lower Acres, Trend Yield” Scenario (30% probability) assumes for “next crop” MY 2017/18:
47.624 ma planted, 38.385 ma harvested, 47.0 bu/ac trend yield, 1.804 bb production, 3.067 bb total supplies,
960 mb exports, 200 mb feed & residual use, 2.191 bb total use, 876 mb ending stocks, 39.98% S/U, & $4.00‐
$4.50 /bu U.S. wheat average price;
KSU Scenario 2) “Lower Acres, Trend Yield, +20% Exports” Scenario (10% probability) assumes for “next crop”
MY 2017/18: 47.624 ma planted, 38.385 ma harvested, 47.0 bu/ac trend yield, 1.804 bb production, 3.067 bb
total supplies, 1.152 bb exports***, 200 mb feed & residual use, 2.383 bb total use, 684 mb ending stocks,
24.10% S/U, & $5.25‐$5.75 /bu U.S. wheat average price;
KSU Scenario 3) “Lower Acres, Short Crop Yield” Scenario (10% probability) assumes for “next crop” MY
2017/18: 47.624 ma planted, 38.385 ma harvested, 43.6 bu/ac low yield***, 1.674 bb production, 2.937 bb
total supplies, 925 mb exports, 200 mb feed & residual use, 2.156 bb total use, 781 mb ending stocks, 36.22%
S/U, & $4.40‐$4.90 /bu U.S. wheat average price.
…
April 19, 2017
Grain Market Outlook
at a
record high 252.3 mmt up from 241.7 mmt last year, and 217.6 mmt two years ago. And fourth, World wheat
percent ending stocks‐to‐use (S/U) of 34.05% ‐ up from 34.0% last year, and from 30.85% two years ago –the
highest since MY 2005/06.
For a perspective on how historically large World total wheat stocks and World wheat percent stocks‐to‐use
now are, in MY 2007/08 the 34‐year low in World wheat ending stocks of 128.1 mmt and at least a 57‐year low
in percent ending stocks‐to‐use of 20.9% stocks/use both occurred – the last major World wheat “short crop”
marketing year. The situation in MY 2007/08 compares to projections of 252.3 mmt ending stocks and 34.05%
ending stocks‐to‐use projected for “current” MY 2016/17. The present “large crop‐over supply” situation in
World and U.S. wheat markets have a prevailing negative influence on U.S. and World wheat prices.
However, the broader “large crop‐over supply‐low price” situation in the World wheat market may be
“obscuring” at least a couple of other important market issues. First, while the quantity of wheat available in
the World is plentiful, the available supply of high protein milling wheat is less so. This factor helps exports of
both U.S. Hard Red Spring (HRS) wheat (higher protein – good quality) relative to World wheat export
competitors. Second, while the aggregate supply of wheat in World markets has grown, the supply of wheat in
the “World Less China” is projected to have actually “contracted” or “diminished” in “current crop” MY
2016/17 compared to a year ago – down to the tightest supply‐balances only marginally larger than existed in
MY 2013/14. If this “China factor” eventually leads to noticeably tighter available global supplies of exportable
wheat to occur in coming months, it could have a positive impact U.S. wheat market prices in late‐Spring 2017.
Even so, given the broader World wheat market’s current focus – it is likely that significant World wheat
production problems and/or trade disruptions would need to occur in year 2017 in order to have wheat prices
recover significantly by spring‐summer 2017. Ongoing strength in the U.S. dollar exchange rate is a serious
negative factor limiting the competitive affordability of U.S. wheat exports. These factors have resulted in
higher U.S. wheat ending stocks and % ending stocks‐to‐use, and have caused U.S. and Kansas wheat cash
prices to fall sharply – down near to and below the marketing loan rate in many Kansas locations.
USDA U.S. Wheat Supply/Demand Forecast for “Next Crop” MY 2017/18: On February 23‐24, 2017 at the
Agricultural Outlook Forum in Arlington, Virginia, the USDA released their grain market supply‐demand and
price projections for “next crop” MY 2017/18. With additional acreage and usage information the March 31st
Page | 2
USDA Prospective Plantings and Grain Stocks reports, and the April 11th USDA World Agricultural Supply and
Demand Estimates (WASDE) report, the following projections for “next crop” MY 2017/18 are figured. For
“next crop” MY 2017/18, 2017 U.S. wheat plantings are projected to be 46.059 million acres (ma) – down from
50.154 ma in 2015. Harvested acres for 2016 are forecast to be 39.050 ma – down from 43.890 ma a year ago.
Trendline 2017 wheat yields for 2017 are projected at 47.1 bu/a, down from the 2016 record of 52.6 bu/ac,
while the adjusted 2017 U.S. wheat production forecast is 1.839 billion bushels (bb), down from 2.310 bb in
2015. Projected “next crop” MY 2017/18 total supplies are 3.118 bb (down from 3.395 bb in “current” MY
2016/17), with total use of 2.191 bb (down from 2.236 bb in “current” MY 2016/17).
Given these numbers, the adjusted USDA projection of “next crop” MY 2017/18 ending stocks equals 927
million bushels (mb) (vs 1.159 bb a year ago), with percent ending stocks‐to‐use of 42.3% S/U (vs 51.8% last
year and 50.0% the previous year). United States’ wheat prices are projected to average approximately $4.25
/bu – up from $3.85 in “current” MY 2016/17, but down from $4.89 /bu in MY 2015/16, and $5.99 /bu in MY
2014/15. It is assumed by Kansas State University that these adjusted USDA projections for “next crop” MY
2016/17 have a 50% probability of occurring.
Three Alternative KSU U.S. Wheat S/D Forecast for “Next Crop” MY 2017/18: As an alternative to the USDA’s
projection, three potential KSU‐Scenarios for U.S. wheat supply‐demand and prices are presented for “next
crop” MY 2017/18.
KSU Scenario 1) “Trend Yield” Scenario (25% probability) assumes for “next crop” MY 2017/18 that the
following occurs. It is assumed that there will be 46.059 ma planted, 39.334 ma harvested, 47.0 bu/ac trend
yield, 1.849 bb production, 3.128 bb total supplies, 975 mb exports, 190 mb feed & residual use, 2.191 bb total
use, 937 mb ending stocks, 42.8% S/U, & $4.20 /bu U.S. wheat average price.
KSU Scenario 2) “Higher U.S. Wheat Exports” Scenario (15% probability) assumes for “next crop” MY 2017/18
the following. The following is forecast for “next crop” MY 2017/18, i.e., 46.059 ma planted, 39.334 ma
harvested, 47.0 bu/ac trend yield, 1.849 bb production, 3.128 bb total supplies, 1.150 bb exports, 190 mb feed
& residual use, 2.326 bb total use, 802 mb ending stocks, 24.10% S/U, & $4.90 /bu U.S. wheat average price;
KSU Scenario 3) “Short U.S. Wheat Crop” Scenario (10% probability) assumes for “next crop” MY 2017/18 that
the following happens. This scenario assumes 46.059 ma planted, 37.124 ma harvested, 40.0 bu/ac low yield,
1.485 bb production, 2.769 bb total supplies, 975 mb exports, 175 mb feed & residual use, 2.175 bb total use,
594 mb ending stocks, 27.31% S/U, & $5.50 /bu U.S. wheat average price.
…
June 1, 2009
Water Policy
biotechnology derived crops in 2005 with the acres being concentrated … and sweet corn)
(Sankula, 2005).
The adoption of virus … grower returns” (Sankula,
2005).
Although there is no …
May 14, 2014
Grain Market Outlook
Low
April 11th
$8.55 ½ High
May 6th
$8.24 ½ Close
May 12th
Page | 3
Futures trended generally higher since the low, moving as high as $8.55 ½ on May 6th prior to the lower closes
following the May 9th USDA reports.
I‐C. U.S. Wheat Production
U.S. All Wheat Acreage, Yield & Production
Following the results of March 31st USDA NASS Prospective Plantings Report, the USDA projected that
2014 U.S. wheat total planted acreage would be 55.815 million acres (ma), down from 56.156 ma in 2013 and
55.666 ma in 2012, but up from 54.409 ma in 2011 (Table 1 and Figures 1‐2). In addition, the USDA projected
2014 U.S. wheat harvested acreage to be 47.2 ma, up from 45.157 ma in 2013, down from 48.921 ma in 2012,
and up from 45.705 ma in 2011.
The forecast 2014 proportion of harvested‐to‐planted acreage for all U.S. wheat is projected to be 82.2%,
up from 80.4% in 2013, but down from 87.9% in 2012 and 84.0% in 2011. The proportion of harvested‐to‐
planted U.S. wheat acreage in 2013 of 80.4% was the lowest since 81.6% in 2006 and 76.0% in 2002.
The projected 2014 U.S. average wheat yield of 42.7 bushels per acre (bu/ac) is down from the record high
of 47.2 bu/ac in 2013, the previous records of 46.3 bu/ac in 2012 and 2010, and 43.7 bu/ac in 2011 (Table 1
and Figure 3). The USDA projected 2014 U.S. wheat production to be 1.963 billion bushels (bb) – which is
down from 2.130 bb in 2013, 2.266 bb in 2012, and 1.999 bb in 2011 (Table 1).
U.S. Winter Wheat Acreage, Yield, and Production for 2014
In its May 9th USDA Crop Production report the USDA projected U.S. winter wheat planted acreage to be
42.007 million acres (ma). These acres of winter wheat were seeded in the fall of 2013 with the intention of
harvesting them in the summer of 2014. This projection of 42.007 ma planted in the U.S. in 2014 is down from
43.090 ma in 2013, but greater than 41.224 ma in 2012, and 40.646 ma in 2011 (Figure 1). Winter wheat
harvested acreage in the U.S. in 2014 is projected to be 32.572 ma – with an implicit 2014 U.S. winter wheat
percent harvested‐to‐planted acres of 77.5%. This compares to U.S. winter wheat harvested acreage in 2013
of 32.402 ma – with an implicit 2013 U.S. winter wheat percent harvested‐to‐planted acres of 75.2%. IF
extreme drought conditions continue in the U.S. Great Plains states of Texas, Oklahoma, Kansas, Colorado and
Nebraska in coming weeks and months – the five states of which make up the primary U.S. hard red winter
wheat production area – then the proportion of harvested‐to‐planted acres in 2014 could decline even further,
possibly even below the 75.2% level of 2013.
Winter wheat yields in 2014 in the U.S. are projected to be 43.1 bu/ac, down from the record high of 47.4
bu/ac in 2013. United States’ 2014 winter wheat production is forecast to be 1.403 bb, down from 1.534 bb in
2013. Of the 2014 total of 1.963 bb, 2014 U.S. hard red winter wheat production is forecast to be 746 million
bushels (mb), up marginally from 744 mb in 2013. U.S. 2014 soft red winter wheat production is forecast to
be 447 million bushels (mb), down from 565 mb a year ago – primarily due to lower planted acreage in 2014.
White winter wheat production in the U.S. in 2014 is projected to be 209 mb, down 7% from 2013.
U.S. Other Spring & Durum Wheat Acreage, Yield and Production for 2014
The USDA projection of 2014 U.S. other spring wheat planted acreage is equal to the March 31st USDA
Prospective Plantings report forecast of 12.009 ma. Similarly, 2014 U.S. durum wheat planted acreage is
forecast to be 1.799 ma. The USDA’s estimate of 2014 U.S. other spring wheat planted acreage to 12.009 ma is
Page | 4
down from both 12.289 ma in 2012, and 12.394 ma in 2011. The USDA’s estimate of 2013 U.S. durum wheat
planted acreage to 1.799 ma is down from 2.153 ma in 2012, but up from 1.369 ma in 2011.
Based on its internal projections that have not been formally released to the public, the USDA World
Agricultural Outlook Board has calculated 2014 U.S. other spring wheat and durum harvested acres using 10‐
year harvested‐to‐planted ratios by state off of its state‐level planted acreage projections. Similarly, spring
wheat and durum wheat yields were estimated using 1985‐2013 yield trends by state (except for durum wheat
in Arizona, California, and Idaho). The combined 2014 production forecast for U.S. spring and durum wheat
together is approximately 560.5 mb, down from 595.4 mb (533.5 mb of other spring wheat, and 61.9 mb or
durum wheat) in 2013.
I‐D. U.S. Wheat Total Supplies
The USDA projected that total supplies of U.S. wheat for “new crop” MY 2014/15 would be 2.706 bb – the
lowest amount of U.S. wheat supplies since the 2006/07 and 2007/08 marketing years. Projected total
supplies of 2.706 bb in “next crop” MY 2014/15 is comparable to 2.501 bb in MY 2006/07, 2.620 bb in MY
2007/08, 2.932 bb in MY 2008/09, 2.993 bb in MY 2009/10, 3.279 bb in MY 2010/11, 2.974 bb in MY 2011/12,
3.131 bb in MY 2012/13, and 3.023 bb in “current year” MY 2013/14.
Total supplies of 2.706 bb resulted from beginning stocks of 583 mb, projected 2014 production of 1.963
bb, and projected imports of 160 mb (Table 1).
Forecast U.S. wheat beginning stocks of 583 mb in “next crop” MY 2014/15 would be down 18.8% from
718 mb beginning stocks in “current” MY 2013/14, and down from 743 mb in MY 2013/14. This would be the
lowest level of U.S. wheat beginning stocks since 306 mb in MY 2008/09 (following the tight ending stocks
situation that developed in MY 2007/08. This projected decline in U.S. wheat ending stocks into the “new
crop” 2014/15 marketing year is a continuance of the steadily increasing tightness of U.S. wheat supplies that
has occurred over the last four marketing years (since the recent high in beginning stocks of 976 mb in MY
2010/11).
Projected U.S. wheat imports of 160 mb for “new crop” MY 2014/15 would be the second highest amount
on record, down from the record high of 170 mb in “current” MY 2013/14. The next highest amounts since MY
1973/74 have been: 1) 127 mb in MY 2008/09; 2) 123 mb in MY 2012/13; 3) 122 mb in MY 2006/07; and 4) 119
mb in MY 2009/10. Record large 2013 Canadian wheat production of 37.5 million metric tons (mmt) (or
1,377.5 million bushels in 60 lb/bu units) has had and likely will continue to have an impact on U.S. wheat
imports until the 2014 U.S. wheat harvest period. The next largest Canadian wheat crops since 1960 that were
over 30.0 mmt were in 1990 (32.098 mmt), 1991 (31.946 mmt), and 1986 (31.359 mmt). Projected Canadian
wheat production in the “new crop” 2014/15 marketing year is lower – down to 28.5 mmt.
I‐E. U.S. Wheat Total Use & Use by Category
Food Use: Projected U.S. wheat food use of 970 mb in “new crop” MY 2014/15 has been trending steadily
higher over time due to steady growth in the U.S. population and associated food demand for processed
wheat products. This projected amount of 970 mb food use in “new crop” MY 2014/15 is up 10 mb or 1.04%
from 960 mb in “current” MY 2013/14, from 945 mb in MY 2012/13, and from 941 mb in MY 2011/12 (Table 1
and Figure 4).
Page | 5
Seed Use: Forecast seed use of 76 mb in “new crop” MY 2014/15 is up marginally from 74 mb in “current”
MY 2013/14, and from 73 mb in “last year’s” MY 2012/13, but equal to 76 mb in MY 2011/12 (Table 1 and
Figure 4). The USDA forecast U.S. wheat seed use of approximately 76 mb for “next year” MY 2014/15 extends
the historic pattern of the existence of a relatively small but inelastic demand for U.S. wheat seed. Seed wheat
demand is driven primarily by the amount of U.S. wheat seed needed to plant adequate U.S. wheat acreage
each year (from on‐farm and commercial seed sources) and also the need for adequate wheat seed stocks to
cover possible seed wheat production shortfalls.
Exports: Projected U.S. wheat exports of 950 mb in “new crop” MY 2014/15 are down sharply from 1.185
bb for “current” MY 2013/14 (which is up 10 mb from April). This amount of U.S. wheat exports would be the
lowest since 879 mb in MY 2009/10. The anticipation of lower available supplies of U.S. hard red winter wheat
for export sales in 2014/15 along with the likelihood of more than adequate foreign wheat supplies are factors
in this lower U.S. export projection of 950 mb in “new crop” MY 2014/15 (Table 1 and Figure 4). That said, the
risk of lower “new crop” MY 2014/15 Australian wheat production with the forecast onset of an El Nino
weather pattern in coming months, as well as the uncertain impact on World wheat trade in the future from
geopolitical conflicts in the Black Sea Region (between Russian and Ukraine) are factors that may support
World wheat prices in the new crop marketing year.
On May 1st cumulative U.S. wheat export shipments for the “current” 2013/14 marketing year totaled
1.021 bb, which is 86.2% of the USDA’s projected “current” MY 2013/14 exports of 1.185 bb with 92.3% (48 of
52 weeks) of the marketing year completed. “Current year” MY 2013/14 ends on May 31, 2014. United States’
export shipments will need to average 41.0 mb per week through the remainder of the “current” 2013/14
marketing year to attain the USDA’s May WASDE projection of 1.185 bb. Wheat export shipments by the U.S.
of 24.9 mb and 19.3 mb occurred during the weeks ending March 24th and May 1st, respectively, were “behind
pace” to meet the USDA forecast of 1.185 bb in the “current” 2013/14 marketing year. (Source: USDA Foreign
Agricultural Service U.S. Weekly Export Sales report ‐ http://apps.fas.usda.gov/export‐sales/esrd1.html).
However, accounting for unshipped forward sales of exports of 139.1 mb in U.S. wheat for “current” MY
2013/14 (that had not yet been shipped as of May 1st), total U.S. wheat shipped plus outstanding shipments
added up to 1.161 bb (i.e., 1.021 bb shipped plus 139.1 mb forward sales with rounding) for “current” MY
2013/14. This amounts to 98.0% of the USDA’s projection of 1.185 bb for “current” MY 2013/14 with 92.3% of
the marketing year having already occurred (i.e., 48 of 52 weeks).
There are also 114.9 mb of forward sales of U.S. wheat in the “new crop” 2014/15 marketing year as of
May 1st. It is possible if not likely that some of the unshipped forward sales remaining in “current year” MY
2013/14 will be cancelled and possibly “rolled forward” into “new crop” MY 2014/15 (beginning on June 1st).
Feed & Residual Use: The USDA projected that U.S. feed and residual use would be 170 mb in “next crop”
MY 2014/15, down from 220 mb for “current” MY 2013/14, from the recent high of 388 mb in MY 2012/13,
while still being up from 162 mb in MY 2011/12 (Table 1 and Figure 4). Domestic U.S. wheat feeding has
declined due to sizable 2013 U.S. corn and grain sorghum crops – leading to more abundant U.S. feedgrain
supplies at lower market prices than during the “drought stricken” MY 2012/13. Subsequently, there is now
lower cross‐market demand for U.S. wheat in livestock feed rations – in both domestic or foreign markets.
Total U.S. Wheat Use: Summing the categories together, total use of U.S. wheat for “new crop” MY
2014/15 is projected to be 2.166 bb (Table 1 and Figure 4). U.S. wheat total use of 2.166 bb in “new crop” MY
2014/15 would be the 4th smallest amount of U.S. wheat total usage over the last decade (since MY 2005/06).
Total U.S. wheat …
July 16, 2014
Grain Market Outlook
roduction in North America or other major wheat producing regions of the World, or geopolitically‐driven
disruptions to trade World wheat markets in such places as the Middle East or the Black Sea region. Unless or
until such disruptive events as these would occur, World wheat market prospects are pointing to steady‐to‐
lower World wheat prices.
USDA U.S. Wheat Forecast for “New Crop” MY 2014/15: Compared to a year earlier, the USDA projected
lower 2014 U.S. wheat production, reduced wheat usage, an increase in U.S. wheat ending stocks and %
stocks‐to‐use, and lower prices in “new crop” MY 2014/15. The USDA’s projected “new crop” market scenario
is: 56.5 million acres (ma) planted, 46.2 ma harvested, 81.9% harvested‐to‐planted acres, 43.1 bu/ac yield (up
from 42.3 bu/ac a month ago), a 1.992 billion bushel (bb) 2014 U.S. wheat crop (up 50 million bushels or ‘mb’),
2.741 bb total supplies (up 46 mb), 900 mb exports (down 25 mb), 2.081 bb total use (down 40 mb), 660 mb
ending stocks (up 86 mb), 31.7% ending stocks‐to‐use (up from 27.1%), and $6.60 average price per bu. (range
of $6.00 to $7.20) – down from $7.00 /bu.
KSU U.S. Wheat Forecast for “New Crop” MY 2014/15: KSU projections of “new crop” MY 2014/15 supply‐
demand balances and prices are as follows: a) “Likely Production” Scenario: 65% prob. of 46.2 ma harvested,
43.1 bu/ac, 1.992 bb 2014 U.S. wheat production, 2.741 bb U.S. wheat supplies, 900 mb exports, 2.081 bb total
use, 660 mb ending stocks, 31.7% S/U, & $6.10 /bu; b) “Low Production” Scenario: 20% prob. of 45.4 ma
harvested, low yields of 41.1 bu/ac (both harvested acres and yield lower than USDA), 1.868 bb 2014 U.S.
wheat production, 2.628 bb U.S. wheat supplies, 890 mb exports, 2.061 bb total use, 567 mb ending stocks,
27.5% S/U, & $6.55 /bu; and c) “Expected Production – Higher Exports” Scenario: 15% prob. of 46.2 ma
harvested, yields of 43.1 bu/ac, 1.992 bb 2014 U.S. wheat production, 2.741 bb U.S. wheat supplies, 1.050 bb
exports (up 150 mb from USDA forecast), 2.231 bb total use, 510 mb ending stocks, 22.9% S/U, & $7.50 /bu.
USDA World Wheat: World wheat total supplies of 889.5 mmt in “new crop” MY 2014/15 are down marginally
from 889.8 mmt in “old crop” MY 2013/14, but up from 854.9 mmt in MY 2012/13. Projected World wheat
ending stocks in “new crop” MY 2014/15 of 189.5 mmt (27.0% S/U) are up from 184.3 mmt (26.1% S/U) in MY
2013/14, and from 175.6 mmt (25.9% S/U) in MY 2012/13.
For market perspective these levels of World wheat stocks need to be analyzed relative to the historic World
wheat stocks minimum of 129.4 mmt (21.0% S/U) in MY 2007/08. Year‐over‐year increases are projected for
wheat exports in “new crop” MY 2014/15 for Argentina (+4.5 mmt), Brazil (+0.4 mmt), and Russia (+1.0 mmt),
with decreases forecast for the U.S. (‐7.7 mmt), Australia (‐0.5 mmt), Canada (‐1.5 mmt), the EU (‐2.5 mmt),
India (‐2.4 mmt), Kazakhstan (‐2.4 mmt), and Ukraine (‐0.5 mmt). …