TheCropSite.com- news, features, articles and disease information for the crop industry

USDA Grains: World Markets and Trade


13 August 2012

USDA Grains: World Markets and Trade - August 2012USDA Grains: World Markets and Trade - August 2012


USDA Grains: World Markets and Trade Reports

U.S. Corn Exports Slashed; Lowest Stocks Since 1995/96

Extreme heat and dryness in much of the U.S. corn belt continued to decimate the U.S. corn crop during July. The reduction in U.S. corn production is estimated to result in the lowest stocks, 16.5 million tons (MT), since 1995/96. The supply situation in the United States will constrain exports, which are estimated at 33.5 MT, the lowest in 19 years. Major global importers will struggle to fulfill their demand for corn in feed rations and are expected to turn to other suppliers, particularly South American, and to diversify their feedstuffs. South American producers are expected to respond to record prices by planting more corn in the coming months.

Reduced prospects for the U.S. corn crop result in a forecast record season-average farm price of $8.20 per bushel midpoint, surpassing last year’s record of $6.25.

WHEAT: WORLD MARKETS AND TRADE

OVERVIEW

Global wheat production for 2012/13 is lowered 2.5 million tons as cuts in Russia, Kazakhstan, and Argentina more than offset larger crops in Ukraine, Canada, and India. Despite lower global production, global trade is forecast up as high corn prices will encourage increased feed-quality wheat trade. Russian exports are cut significantly again this month due to continued dry conditions. Most other exporters are raised this month to make up for this supply shortfall and higher demand for wheat for feeding. U.S. exports, however, are unchanged this month as U.S. supplies remain uncompetitive at current prices. U.S. supplies are up slightly with higher production. Global trade in 2011/12 hit a new record reflecting strong late-season shipments. The 2012/13 season-average U.S. farm price is projected $1.50 higher at a record $7.60-9.00 per bushel.

PRICES:

Domestic: Prices of all wheat classes continued to surge earlier in July before dropping slightly. Higher corn prices are supporting wheat prices. Hard Red Winter (HRW) soared $30 to $366 per ton. Soft Red Winter (SRW) advanced $27 to $340 per ton, while Soft White Winter (SWW) jumped $24 to $336 per ton. Hard Red Spring (HRS) rose $2 to $384 per ton.

TRADE CHANGES IN 2012/13

Selected Exporters

  • Argentina is cut 500,000 tons to 6.5 million as a result of reduced crop prospects.
  • Australia is up 500,000 tons to 21.0 million due to a continued strong export pace (from 2011/12) and abundant old-crop supplies.
  • Brazil is raised 500,000 tons to 1.0 million as higher world prices will pull domestic wheat into export channels.
  • Canada is boosted 1.0 million tons to 19.5 million on a larger expected crop and ample supplies.
  • EU is up 1.0 million tons to 17.0 million as tightening supplies in Russia make exports more competitive.
  • Pakistan is raised 500,000 tons to 800,000 based on reports of sales to Southeast Asian countries.
  • Russia is slashed 4.0 million tons to 8.0 million as dryness continues to affect the crop.
  • Turkey is lowered 500,000 tons to 3.2 million on tight supplies due to a smaller crop.
  • Ukraine is raised 2.0 million tons to 6.0 million due to a larger crop and tight supplies in Russia.

Selected Importers

  • Egypt is cut 500,000 tons to 9.5 million on ample stocks as a result of the high volume of imports at the close of 2011/12.
  • EU is raised 500,000 tons to 6.0 million due to more feed-quality wheat supplies in Ukraine.
  • Morocco is cut 500,000 tons to 4.5 million because of a larger crop and high carry-over stocks.
  • South Korea is up 500,000 tons to 4.6 million on expectations of large feed-quality wheat purchases.
  • United States is up 300,000 tons to 3.5 million on expected imports of feed-quality wheat.
  • Vietnam is boosted 500,000 tons to 2.5 million on anticipated purchases of feed-quality wheat.

TRADE CHANGES IN 2011/12

Selected Exporters


Large late-season adjustments reflect reported shipments

  • Argentina is raised 450,000 tons to 12.0 million.
  • Australia is boosted 500,000 tons to a record 23.0 million.
  • Russia is up 300,000 tons to a record 21.6 million.
  • Ukraine is raised 300,000 tons to 5.3 million.
  • Uruguay is up 300,000 tons to a record 1.6 million.

Selected Importers

  • Egypt is up 400,000 tons to a record 11.6 million.
  • EU is down 300,000 tons to 7.2 million.
  • Sudan is raised 300,000 tons to 2.2 million.
  • Thailand is raised 300,000 tons to a record 2.6 million.
  • Turkey is up 600,000 tons to a record 4.4 million.

RICE: WORLD MARKETS AND TRADE


OVERVIEW

Global production in 2012/13 is reduced primarily due to a poor Indian monsoon. For the first time since 2006/07, global consumption is anticipated to outpace production, but ample supplies in major exporting countries are keeping prices in check. Trade in 2012/13 is forecast to drop marginally from 2011/12. U.S. production and exports are up year to year.

FEATURE

Exportable supplies in major exporting countries (India, Mercosur members, Pakistan, Thailand, United States, and Vietnam) are expected to be abundant in 2012/13. This, combined with record exportable supplies in 2011/12, is keeping prices stable despite a relatively small U.S. crop and issues with the Indian monsoon. While rice quotes remain split in 2 tiers, they have changed little over the last 2 months. This is in sharp contrast to other commodities that have been more severely affected by the U.S. drought.

SELECTED TRADE CHANGE

Brazil’s 2012 exports are boosted 100,000 tons to 1.0 million on pace, while 2013 is dropped 300,000 tons to 600,000 on tighter supplies.

COARSE GRAINS: WORLD MARKETS AND TRADE


OVERVIEW

Global corn trade for 2012/13 is cut sharply again this month because of drastically tighter exportable supplies in the United States outweighing record exportable supplies in South America. Unfavorable conditions also reduce Ukrainian, Serbian, and EU corn production and trade. U.S. corn exports are expected to be the lowest in almost two decades. The 2012/13 season-average farm price is projected sharply higher (nearly 40 percent) at a record. U.S. exports are also lowered for 2011/12.

PRICES

U.S. corn export quotes continued to soar (gaining over $40/ton) following the release of USDA’s July report, finally peaking at nearly $360/ton. Since that time, however, quotes have dropped almost $25/ton to $334 in early August on slow sales and shipments and as logistical problems (low river levels) continue to hamper trade. South American quotes have moved in tandem with U.S. corn. Black Sea corn prices, however, have moved closer to U.S. corn (higher) as hot, dry conditions have reduced the Ukrainian crop.

TRADE CHANGES IN 2012/13

Selected Exporters

U.S. corn exports are slashed by 6.5 million tons to 33.5 million, the lowest since 1993/94, based on sharply lower crop prospects following prolonged heat and dryness in key growing areas. Since June, U.S. exports have been cut a total of 14.5 million tons. Based on the huge cut in U.S. corn exports, the following changes are made:

  • Argentine corn is raised 2.0 million tons to a record 17.5 million based on prospects for a record crop in 2013.
  • Brazilian corn is boosted 500,000 tons to a new record 13.0 million with expectations of a near-record crop (following record production in 2011/12).
  • Canadian corn is raised 200,000 tons to 1.0 million.
  • South African corn is up 300,000 tons to 2.3 million with expectations of a record crop in 2013 with expanded area.


  • Dryness in key growing areas of Eastern Europe reduces exportable supplies of corn and exports are cut a combined 3.0 million tons: Ukraine (1.5 million tons), EU (1.0 million tons), and Serbia (500,000 tons).
  • Kazakh barley is halved to 200,000 tons on reduced crop prospects.
  • U.S. sorghum is cut sharply by 1.0 million tons to 2.5 million because of reduced exportable supplies caused by hot, dry conditions in the southern and central Plains.

Selected Importers

U.S. corn is more than doubled to a record 1.9 million tons because of extreme drought conditions, likely shortages of domestically produced seed corn next season, and indications of competitive imports from South America (and possibly Europe). Based on the substantial cut to U.S. corn exports, a number of offsetting import changes are made:

  • Chinese corn is cut 3.0 million tons to 2.0 million with improved domestic crop prospects and higher U.S. prices.
  • EU corn is lowered 2.0 million tons to 3.0 million, despite a sharply lower crop, because of tightening exportable supplies out of Serbia and Ukraine.
  • Indonesian, Japanese, Korean, Mexican, and Vietnamese corn are each cut 500,000 tons.
  • Colombian, Israeli, Peruvian, and Syrian corn are lowered a combined 1.0 million tons.


  • Algerian barley is cut 200,000 tons to 100,000 on improved crop prospects.
  • U.S. barley is boosted 200,000 tons to 500,000 to substitute for corn and reduced supplies of distillers’ dried grains in feed rations.
  • Mexican sorghum is down 1.0 million tons to 2.0 million because of reduced exportable supplies in the United States.

TRADE CHANGES IN 2011/12

Selected Exporters

  • U.S. corn is cut 1.0 million tons to 39.0 million as slow sales and shipments continue and drought conditions affect barge traffic on the Mississippi River.
  • Argentine corn is boosted by 1.5 million tons to 16.0 million based on sharply higher carryin stocks as surveyed by the government, expectations of additional export licenses being granted, and near-record shipments from March through July.
  • Based on trade data, Ukrainian corn is raised 500,000 tons to 14.5 million and South
  • African corn is up 200,000 tons to 1.7 million.
  • Australian barley is boosted 500,000 tons to 5.0 million on the strong pace of shipments.
  • EU barley is cut 400,000 tons to 2.4 million as a result of lower-than-expected new-crop production and tighter stocks.

Selected Importers

  • Egyptian and South Korean corn are each raised 500,000 tons because of higher-thanexpected shipments in recent months.
  • Indonesian and Syrian corn are cut a combined 800,000 tons because of slower-thanexpected shipments.
  • Mexican corn is boosted 700,000 tons to 11.2 million because of tight supplies arising from a smaller crop in 2011/12.
  • Chinese barley is up 200,000 tons to 2.2 million on strong demand for malting barley.
  • Russian barley is doubled to 400,000 tons to fulfill malting needs.

DOWNLOAD REPORT:- Download this report here

Share This


Related Reports

Reports By Country

Reports By Category

Our Sponsors