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U.S.
Wheat Sales Strong Despite Challenges
Combined
production by Australia and Canada is forecast down 16 million tons from last
year. With Canadian supplies of Western Hard Red Spring (CWRS) particularly
tight, exports are estimated to be only half of last year. Consequently, the
Canadian Wheat Board has announced that it will curtail sales. U.S. Hard Red
Spring sales are expected to benefit, particularly in Latin America, where U.S.
sales thus far have been 50 percent above last year. Sales to this region also
have benefited from Argentina’s economic problems and reduced production, as
U.S. sales to Brazil thus far are nearly 700,000 tons compared to only 200,000
for all of last year.
In Asia, Japan, South Korea, and the Philippines have all bought more U.S. wheat this year.
The
strong pace of sales is occurring despite U.S. wheat prices that have risen
dramatically over the past several months as a result of lower U.S production
and smaller crops in other major exporting countries. The U.S. crop is estimated
at 44.2 million tons, which is about 9 million less than last year’s very
small crop. At the same time, crops in the EU and FSU are forecast up
significantly from last year. With a major price advantage, these suppliers have
been gaining market share at the expense of the United States, as evidenced by
poor U.S. sales to North Africa. For example, this year U.S. wheat has been
nearly shut out of Egypt with sales of only 253,000 tons compared to 1.6 million
tons during the same period last year. Cheaper French, Ukrainian, and Russian
wheat is capturing most of the market. The large EU supplies have also meant
much smaller EU purchases from the United States. While some milling wheat is
still making its way into the EU, SRW exports to Italy and Spain, which were
significant last year, have not occurred due to uncompetitive U.S. prices this
year.
For more information,
contact: Oliver Flake, 202-690-4200
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