OVERVIEW

Global production in 2015/16 is raised to a new record as larger crops in the EU more than offset lower production in Australia and Russia. Global trade is raised slightly. Exports are up in Brazil, Canada, and the EU, but cut in Australia and the United States. The season-average farm price forecast is unchanged from last month.

U.S. PRICES:

Prices for all U.S. wheat classes changed slightly in the last month. Hard Red Spring (HRS) and Hard Red Winter (HRW) were down $5 to $248/ton and $3 to $218/ton, respectively. In an unusual development, HRW prices dropped below Soft Red Winter (SRW) and Soft White Wheat (SWW). SRW prices rose $4 to $222/ton and SWW prices jumped $9 to $222/ton. It is becoming a challenge to source preferred qualities in SRW and SWW for export.

TRADE CHANGES IN 2015/16

Selected Exporters

  • Australia is cut 1.0 million tons to 17.5 million on tighter exportable supplies due to a smaller forecast crop.
  • Brazil is up 500,000 tons to 1.5 million on projected higher feed-quality wheat exports.
  • Canada is raised 1.0 million tons to 20.5 million on the strong pace of trade to date.
  • European Union is up 500,000 tons to 33.5 million on higher production and large exportable supplies. The export pace is expected to pick up during the second half of the year.
  • India is boosted 500,000 tons to 800,000 on the strong pace of trade to date.
  • United States is down 1.0 million tons to 22.0 million, a 44-year low, based on weak shipments and slow sales.

Selected Importers

  • Brazil is down 400,000 tons to 6.3 million based on lower domestic demand and continued currency weakness.
  • China is cut 500,000 tons to 2.0 million based on the Government's tightening controls over the Tariff Rate Quota (TRQ) because of surplus domestic supplies.
  • Ethiopia is boosted 500,000 tons to a record 1.6 million on a large government tender. The Government intends to use this wheat to meet consumer demand, address emergency food needs in drought stricken areas, and replenish reserves.
  • India is cut 500,000 tons to 300,000 because the Government raised the import duty from 10 to 25 percent, dampening import prospects.
  • Thailand is up 400,000 tons to 3.2 million on the fast pace of trade to date, particularly feed-quality wheat.