USDA raises U.S. and world wheat ending stocks estimates

Farm and Ranch December 13, 2010 Going in to USDA’s December supply and demand report last Friday the market expectation was that the estimate for wheat ending stocks next May in the U.S. and world would be lowered from the previous report. After all says Helen Pound of Penson GHCO, we heard a lot about problems with wheat around the world.

Pound: “Most recently Australia and the rain in Australia. The conversation about quality deterioration has really driven the market a lot higher. I think people thought this report would show maybe a big increase in exports, but it really did not do that. We actually increased U.S. wheat carryover by 10 million bushels although even a change like that just keeps the carryover versus usage percent on wheat at an extremely overabundant 35%. So we continue to have lots and lots of wheat in the United States.”

While the USDA left its forecast for U.S. wheat exports unchanged overall there were changes among wheat classes. Estimates for white wheat and hard red spring wheat exports were raised and exports for hard red winter lowered. White wheat ending stocks next May are now projected to be 83 million bushels, three million more than the previous year’s carryover.

Although USDA narrowed the range for its forecast of the national average price for wheat, the mid-point remains $5.55 a bushel.

I’m Bob Hoff and that’s the Northwest Farm and Ranch Report on Northwest Aginfo Net.

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