SITUATION AND OUTLOOK:

COMMENTARY AND CURRENT DATA

WORLD WHEAT SITUATION AND OUTLOOK

World wheat trade in 2001/02 is forecast to be 106.2 million tons, up 3.4 million tons from 2000/01. Global production is forecast down as smaller crops in the United States, Canada, EU, China, and South Asia more than offset increases in Eastern Europe, FSU, North Africa, and Argentina. Consumption is expected to remain well above production for the third consecutive year leading global stocks to fall an estimated 27 million tons from last year to their lowest level in 19 years.

In early August, export quotes for #2 HRW FOB Gulf averaged $125/MT, up only $1 from last month as indications of tightening exportable supplies in some major countries were countered by prospects for additional exportable supplies from smaller exporters and lagging global import demand. Expected global production is largely unchanged from last month as reduced prospects in China, Canada, and the EU are countered by better prospects in Russia, Kazakstan, and Eastern Europe. Global consumption is forecast up nearly 2 million tons while ending stocks are estimated down more than 2 million tons. World wheat trade in 2001/02 is forecast 1 million tons lower than last month as lower expected exports from Canada and the EU more than offset more exports from Kazakstan and Eastern Europe.

2001/2002 Trade Changes

Selected Exporters

• Canada down 1.5 million tons to 16.5 million due to smaller crop prospects

• EU down 1 million tons to 12.5 million on prospects for a smaller crop and tighter exportable supplies.

• Eastern Europe up 1 million tons to 4.5 million based on better-than-expected crops in Romania and Hungary.

Selected Importers

• Brazil down 300,000 tons to 7.0 million with prospects for a larger crop.

• Peru up 200,000 tons to 1.5 million based on higher expected consumption.

• EU up 500,000 tons to 4.5 million because of tighter feed grain supplies, higher domestic prices, and lower import duties on lower quality wheats.

• United States down 200,000 tons to 2.4 million due to a lagging import pace.

2000/2001 Trade Changes

Selected Exporters

• Argentina down 500,000 tons to 11.0 million due to slower than expected export shipments to date.

Selected Importers

• Brazil down 300,000 tons to 7.3 million because of fewer imports late in the year.

• Peru up 250,000 tons to 1.5 million because of increased purchases from the United States.

• .South Korea down nearly 200,000 tons to 3.1 million due to fewer purchases of feed quality wheat.

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Last modified: Thursday, November 13, 2003