WORLD WHEAT SITUATION AND OUTLOOK
U.S. wheat prices remained constant over the past month due to uncertainties over the Russian food aid package. Export quotes for #2 HRW FOB Gulf are about $130/ton for nearby shipment compared to $150 this time last year. World wheat trade in 1998/99 stands at 97.7 million tons, slightly below last months estimate. Global stocks are down slightly from last month, as the 2 million ton reduction in the United States more than offsets increases in Canada and several importing countries. Global consumption is expected to be slightly lower, while the stocks-to-use ratio remains at 21 percent.
Wheat exports by the United States are forecast at 31 million tons, 1.5 million tons higher than last month on the recent announcement that USDA will provide food aid to Russia. The package includes a donation of 1.5 million tons of wheat under Section 416(b) as well as 200,000 tons of concessional sales under P.L. 480, Title I.
The 1998/99 wheat export forecast for Australia is lowered by 1 million tons on reduced production prospects due to smaller-than-expected plantings and excessive rainfall in New South Wales. Nevertheless, exports are still expected to match last years 15.5 million tons. Canadas wheat exports in 1998/99 are projected at 15 million tons (500,000 tons lower than last month) on smaller-than-expected shipments over the past few months. Wheat exports by Kazakhstan in 1998/99 are projected down 500,000 tons, to 1.8 million tons on lower-than-expected production prospects.
Russias wheat imports in 1998/99 are expected to reach 3.7 million tons, up 1.7 million from last month based on food aid donations/concessional sales by the United States. The package includes a donation of 1.5 million tons of wheat under Section 416(b) as well as 200,000 tons of concessional sales under P.L. 480, Title I. Russia has been experiencing a financial crisis since the Ruble devaluation in mid-August and is faced with the smallest wheat harvest in nearly 50 years.
1998/99 wheat imports by Iraq are forecast at 2.5 million tons, down 500,000 tons this month due to slower-than-expected purchases over the past few months.
Indias wheat imports are projected at 1 million tons, down 500,000 tons from last month, while wheat imports by Brazil are projected up 200,000 tons this month (to 6.1 million tons) due to a smaller crop and poor quality.
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