OVERVIEW

Global production in 2016/17 is raised to the second-highest on record. Larger crops are projected in the EU (particularly Spain), Russia, and the United States. Brazil's crop is down slightly. Global trade is up, but still below last year's record. The upturn is driven by a significant bump in India's import demand, based on low international prices and faltering domestic procurement. Greater exports for the EU, Russia, and the United States are the only revisions among major suppliers. The season-average farm price is reduced slightly.

For 2015/16, global trade is revised up to a new record, driven mostly by a late-season surge of shipments to Morocco. U.S. imports and exports are lowered marginally.

U.S. PRICES:

Wheat prices were volatile in May, particularly Hard Red Winter (HRW) and Soft Red Winter (SRW). Prices for these classes initially dropped $7/ton and $8/ton, respectively, and then surged $22/ton to $215 and $20/ton to $212 through early June. Hard Red Spring (HRS) was less volatile over the month, but still rose $11/ton to $241. Climbing soybean and corn prices are pulling wheat prices higher despite record global wheat supplies. Soft White Winter (SWW) was up $3/ton to $203.

TRADE CHANGES IN 2016/17

Selected Exporters

  • EU is boosted 500,000 tons to a record 35.5 million as a result of a larger crop and a continuation of strong late-season (2015/16) export licenses.
  • Russia is raised 500,000 tons to a record 25.0 million based on a record crop.
  • United States is up 500,000 tons to 24.5 million on a larger crop.

Selected Importers

  • India is doubled to 2.0 million as low international prices and faltering domestic procurement encourage purchases, particularly from Australia and the EU.
  • Indonesia is lifted 400,000 tons to 9.1 million as high demand for feed-quality wheat in 2015/16 is expected to continue.
  • United States is down 100,000 tons to 3.4 million due to a larger expected domestic crop.

TRADE CHANGES IN 2015/16

Selected Exporters-based on trade data

  • Argentina is up 300,000 tons to 8.8 million.
  • EU is boosted 500,000 tons to 33.0 million.
  • Ukraine is lifted 300,000 tons to 15.8 million.
  • United States is trimmed 100,000 tons to 21.2 million.

Selected Importers-based on trade data

  • Egypt is lowered 500,000 tons to 11.5 million.
  • Indonesia is raised 500,000 tons to 9.1 million.
  • Morocco is up 700,000 tons to 4.7 million