Wheat Prices

Speaker 1: Lower domestic wheat production forecast as expected, led to tightening of USDA's U.S. wheat balance sheet in August, according to World Agricultural Outlook Board Chair Mark Czekanowski. Speaker 2: Generally speaking, not too many changes in the supply and demand balance for wheat. This month, production estimates added up to a 6 million bushel reduction in U.S. production on our balance sheet. We didn't make any changes to our export or other use forecasts, so all that essentially did was tighten up ending stocks by 6 million bushels from where we were last month. So now we're looking at us ending stocks of 717 million bushels, and that's down 203 million bushels from last year, just reflecting the fact that this wheat crop, it's a small crop. It's historically small, a fairly sharp reduction in the European Union production estimate. We lowered it by 1.8 million tons this month, just reflecting that very hot and dry weather that spread kind of across the entire EU region over the summer. A lot of that extreme heat hit right during grain filling stage for wheat. So that is showing up as reduced yield potential. So that would bring U.S. wheat production forecasts down to 134.2 million tons, down just about 11 million tons from last year. Speaker 1: The lower stocks to use ratio, along with expectations for futures and cash prices for the remainder of the marketing year, led to a 20 cent increase in the season, ending average price, now at $6.20 a bushel.