Based on higher expected prices and expectations, Economic Research Service, has projected the season-average price for wheat to be $5.60 to $5.80/bu. This is slightly tightened from December’s range of $5.50 to $5.80.
ERS reports the season-average price for 2009/10 was $4.87 per bushel. The 2010/11 price range is well below the record 2008/09 price of $6.78 per bushel.
Here’s an overview from today’s ERS wheat outlook:
Domestic Situation and Outlook
Total projected supplies for 2010/11, at 3,294 million bushels, are unchanged from January. All-wheat 2010 production is estimated at 2,208 million bushels, unchanged from January, but down 10 million bushels from 2009. All-wheat harvested area is estimated at 47.6 million acres, unchanged from January, and down 2.3 million acres from last year. The U.S. all-wheat estimated yield is 46.4 bu./acre, up 1.9 bushels from 2009. The 2010 yield is up 1.5 bu./acre from the previous record high of 44.9 bushels in
All wheat ending stocks are down 16% from 2009/10. SRW, HRW, HRS, and white wheat ending stocks are down from 2009/10 by 29%, 19%, 10%, and 9%, respectively. Durum ending stocks are up from 2009/10 by 38%.
Global wheat supplies are forecast slightly lower this month by 0.2 million tons. Global wheat production in 2010/11 is forecast down 0.4 million tons at 645.4 million tons. In
Ukraine, final harvest reports indicate slightly lower-than-expected yield and a 0.35-million-ton reduction in wheat output, lowering the harvest to 16.85 million. South
African 2010/11 wheat production is also slightly reduced 0.07 million tons to 1.51 million. These small downward revisions are partly offset by a 0.2 million-ton increase in global beginning stocks, due to a revision for the wheat production series for Kazakhstan going back 9 years and a revision for 2008/09 food consumption for Guatemala.
For the 2008/09 marketing year, an upward adjustment of 0.5 million tons to 11.0 million is made for Argentina’s wheat crop, as the official Argentine wheat production estimates are too low to support the country’s revised wheat usage level.
Virtually no changes are projected for global wheat use for 2010/11, as a 0.6-million-ton increase in food consumption is fully offset by a reduction in wheat feeding.
With global wheat supplies down 0.2 million tons and wheat consumption unchanged, world wheat ending stocks for 2010/11 are projected 0.2 million tons lower this month to 177.8 million.
U.S. Wheat Crop Condition
Winter wheat conditions at the end of January on the Central and Southern Plains are not as favorable compared with this time a year ago because of the lack of soil moisture. On the Central Plains, 27% of the current Kansaswheat crop is rated good to excellent compared with 56% a year ago at this time. Thirty-seven percent of the current Kansas crop rated poor to very poor, up from 11% a year ago. The situation for Nebraska is not as bad as in Kansas. Forty-one percent of the current wheat crop is Nebraskais rated good to excellent compared with 55% a year ago. Fifteen percent of the Nebraska crop is rated poor to very poor compared with 6% a year ago.
Crop conditions are also less favorable this year on the Southern Plains. For Oklahoma,
21% of the crop this year rated good to excellent at the end of January, compared with 61% a year ago. Forty% of the Oklahoma crop rated poor to very poor, while only 7% received that rating a year ago. Nineteen% of the current Texaswheat crop at the end of the first week of February is rated good to excellent compared with 30% a year ago. This year, 51% of the Texas crop is rated poor to very poor compared with 25% a year ago.
Crop conditions in two SRW States, Illinois and North Carolina, at the end of January are better than a year ago at this time. Forty-five percent of the current Illinoiswheat crop is rated good to excellent compared with 38% a year ago. This year 19% of the Illinois crop is rated poor to very poor compared with 21% a year ago. Fifty-three percent of the current North Carolinawheat crop is rated good to excellent compared with 25% a year ago. This year, 9% of the North Carolina crop is rated poor to very poor compared with 29% a year ago.