Demand Offsets Big Wheat Yields

October 1, 2013 11:59 PM
Demand Offsets Big Wheat Yields

USDA’s latest estimate for all-wheat production came in fairly close to trade expectations as phenomenal yields offset lower harvested acres.

USDA estimates all-wheat production for 2013 at 2.13 billion bushels, down 6% from 2012 output, according to USDA’s Small Grains Summary, released September 30. That’s 1%t above the average trade estimate of 2.108 billion bushels but within the range of estimates of 2.016 billion to 2.137 billion bushels.

The 2013 U.S. all-wheat yield is estimated at a record-high 47.1 bushels per acre, up 0.8 bushels from last year. Estimated wheat acres of 45.2 million fell 8% below a year ago, according to the report.

Big Yields

"The yields for most folks have been surprisingly good," says Brian Basting commodity research analyst with Advance Trading, Bloomington, Illinois. The yields are particularly encouraging for the soft wheat classes, Basting adds.

"Yields have been coming in unbelievably good in the northern plains," says Randy Martinson, executive vice president, Progressive Ag, Fargo, N.D. "If our yields are coming in this good, Canada’s will likely increase as well."

Winter wheat production of 1.53 billion bushels was down 7% from 2012 output, according to USDA. Analysts had been anticipating a winter wheat crop of 1.541 billion bushels.

Other spring wheat production of 532 million bushels fell 2%, but was substantially higher—nearly 4% larger—than the 512 million bushels that traders expected.

Durum wheat at 61.5 million bushels was 36% lower than last year’s harvest, but 2.5%, or 1.5 million bushels, stronger than the average trade estimate.

"I’m still friendly toward wheat," Martinson notes. "China is an aggressive buyer of U.S. wheat." Brazil is looking to the United States for wheat due to issues in Argentina, he adds, and U.S. livestock producers have been feeding more wheat.

Oat Production Up, Barley Output Lower

Oat production at 66 million bushels rose 3% above last year but is still the third lowest production on record. The average yield for oats is an estimated 64 bushels per acre, up 2.7 bushels from 2012. Harvested area, at 1.03 million acres, is the second lowest acreage harvested on record.

Estimated barley production at 215 million bushels fell 2% from 2012. Average yield of 71.7 bushels is up 3.8 bushels per acre from the average yield in 2012. Producers seeded 3.48 million acres to barley in 2013, down 4% from 2012. Estimated harvested area, at 3 million acres, is 8% smaller than a year ago.


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