12/12/05 USDA boosts world wheat stocks

Farm and Ranch December 12, 2005 Traders had been expecting a slight drop in U.S. wheat ending stocks in USDA's December supply and demand report, but the department left its projection for the current marketing year unchanged at 530 million bushels. Some minor adjustments were made among wheat classes though soft white wheat was unchanged with carryover stocks next May still pegged to grow substantially from last year to 89 million bushels. Only hard red winter and hard red spring are forecast to see a year-to-year decrease in stocks. Mark Chiodo of Slipka Trading at the Minneapolis Grain Exchange says buying Kansas City or Minneapolis and selling Chicago still looks like a popular spread. Chiodo: "That's been a pretty good play. You know it still looks like the fundamentals point in that direction. Minneapolis/KC should be the strongest of the wheats and probably the strongest thing on the board here." USDA did increase world wheat ending stocks by four million tons from last month to 143 million but that's still less than the previous year. USDA noted larger crops this month for Australia, Canada and China. And the forecast for Chinese imports was cut a half million tons to just two million. Last marketing year China imported nearly seven million tons of wheat. USDA still has India on the books to import one million tons of wheat and it increased projected Pakistani imports to 800-thousand tons. USDA's project 2005-2006 average price is now $3.25 to $3.50 a bushel, down a nickel on the high end. I'm Bob Hoff and that's the Northwest Farm and Ranch Report on the Northwest Ag Information Network.