SITUATION AND OUTLOOK:

COMMENTARY AND CURRENT DATA

WORLD WHEAT SITUATION AND OUTLOOK

World wheat trade in 1999/2000 is estimated at 104.3 million tons, its highest level since 1992/93, but well below historical highs. U.S. exports are facing intensifying competition from Australia, with its record crop, and aggressive selling by the EU, Canada, and Argentina, also with big exportable surpluses. Global production is down and consumption is up this year, which would suggest tightening supplies. However, any upward pressure on prices is mitigated by large stocks, particularly in exporting countries.

Over the past month, U.S. wheat prices have stagnated at near-decade lows. In early March, export quotes for #2 HRW FOB Gulf averaged about $110 per ton for nearby shipment, compared to $120 per ton a year ago. World wheat trade is little changed this month, with higher imports by Mexico, the Philippines, and Russia offset by smaller Egyptian and Pakistani imports.

1999/2000 Trade Changes

Selected Importers

• Egypt imports down 200,000 tons to 6.3 million due to slower-than-expected purchases in early 2000.

• Mexico imports up 200,000 tons to 2.7 million because of unusually strong purchases.

• Pakistan down 700,000 tons to 2.3 million on reports the Government has ended buying for this year, preferring instead to draw down stocks.

• Philippines up 100,000 tons to 2.3 million because of increased wheat demand for feeding

• Russia up 300,000 tons to 4.8 million to reflect the recent US-Russian Government agreement on U.S. food donations.

• United Arab Emirates up 200,000 tons to 1 million based on stepped-up purchases during July-December 1999.

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Last modified: Thursday, November 13, 2003