With all the attention focused on soybeans and corn given the ongoing trade tensions and weather issues, we thought we would look at wheat, especially the export situation.
Earlier in May, USDA released its first look at the 2019/20 balance sheet and projected our overseas sales for the marketing year starting June 1, 2019 at 900 million bushels (mb).
The accompanying graphic shows the initial export projection made by USDA for the new marketing year given in the May WASDE report along with what final exports were in million bushels on the left hand axis, while new crop wheat sales already on the books as of the first week in May as a percent of that May WASDE export projection is plotted on the right hand axis.
A trend line of actual final sales shows our overseas wheat sales trending lower over the past three decades as we lose export share to our competitors.
Even for the coming year, while international trade is projected to be higher, the U.S. share will be lower as all the major wheat exporting nations including Argentina, Australia, Canada, the European Union, Russia and Ukraine will all have greater production.
Exports currently on the books for the 2019/20 season total 93.9 mb, 10.4% of the initial export production which is very close to the 10.1% ten-year average, so there is nothing to suggest that the first USDA export projection is either over or understated.
Interestingly, USDA's first export estimate for this year at 925 mb appears right on target.
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