Wheat prices rose 2.6-6% amid pessimistic USDA report on wheat by 2022/23 MY

2022-05-13 09:43:45
Machine translation
Wheat prices rose 2.6-6% amid pessimistic USDA report on wheat by 2022/23 MY

In yesterday's balance of wheat for 2022/23 MY USDA experts lowered the forecast of production and final stocks more than analysts expected, which led to an increase in prices by 2.6-5.9%.

 

Stock futures rose yesterday:

  • 5.9% or $ 24.16 / t to $ 433.1 / t - July futures for soft winter SRW wheat in Chicago,
  • 5.8 or $ 25.5 / t to $ 466.6 / t - July futures for winter hardwood HRW wheat in Kansas City,
  • 4.8% or $ 22.05 / t to $ 482 / t - September HRS wheat durum futures in Minneapolis,
  • 1% or $ 4.25 / t to $ 392.75 / t - August futures for Black Sea wheat in Chicago,
  • by 2.6% or € 10.5 / t to € 413.75 / t or $ 429.92 / t - September wheat futures on Paris' Euronext.

 

The world balance for wheat in 2022/23 MY will deteriorate significantly compared to the previous season:

  • Initial reserves will decrease to 279.72 million tons (291.22 million tons in 2021/22 MY and 297.92 million tons in 2020/21 MY).
  • World production will decrease to 774.83 million tons, which will be 4.46 million tons less than the projected 2021/22 MY 779.29 million tons (775.72 million tons in 2020/21 MY). Thus, compared to last year, the wheat harvest in Ukraine due to the war will decrease by 11.5 million tons to 21.5 million tons, in the EU by 1.9 million tons to 136.5 million tons, in Australia - by 6.3 million tons to 30 million tons, in Morocco due to drought - by 5.29 million tons to 2.25 million tons. At the same time in Canada production will increase by 11.35 million tons to 33 million tons, in Russia - by 4.9 million tons up to 80 million tons, in the US - by 2.26 million tons to 47.05 million tons.
  • World consumption will decrease by 2.9 million tons to 787.52 million tons due to reduced consumption of wheat for feed in China, the EU and Australia, as well as a significant reduction in food consumption in India.
  • World wheat exports will increase by 5 million tons compared to 2021/22 MY from 199.89 to 204.89 million tons. In particular, Russia will increase exports by 6 million tons to 39 million tons, the EU - by 5 million tons to 36 million tons, Canada - by 8.5 million tons to 24 million tons, India - by 0.35 million tons to 8.5 million tons, while Australia will reduce it by 3.5 million tons to 24 million tons, the United States - by 0.82 million tons to the lowest since 1971/72 MY 21.09 million tons. Ukraine due to the blockade of ports, logistical problems and reduced production will reduce wheat exports by 9 million tons to 10 million tons, which will be the worst figure since 2013/14 MY.
  • World imports will grow to 201.26 million tons (196.5 million tons in 2021/22 MY), although China will leave wheat imports at 9.5 million tons.
  • Final reserves will decrease by 12.7 million tons compared to 2021/22 MY to a 6-year low of 267 million tons, although analysts estimate them at 272 million tons. In particular, in India, reserves will decrease by 5 million tons to a 5-year low 16, 4 million tons, and in Ukraine will grow to 6 million tons (5.6 million tons in 2021/22 MY and 1.51 million tons in 2020/21 MY).