Canada Markets

2013/14 U.S. and Global Wheat Stocks Exceed Expectations

Cliff Jamieson
By  Cliff Jamieson , Canadian Grains Analyst
Connect with Cliff:
@CliffJamieson
The orange bars represent the trend in world wheat carry-out stocks, while the blue bars show the stocks held by the top eight global exporters, both measured in million metric tonnes on the primary vertical axis. The solid line with markers indicates the percentage of global stocks held by the eight major exporters, measured against the secondary vertical axis. Global supplies are set to increase in 2013/14. (DTN graphic by Scott R Kemper)
The orange bars represent the trend in world wheat carry-out stocks, while the blue bars show the stocks held by the top eight global exporters, both measured in million metric tonnes on the primary vertical axis. The solid line with markers indicates the percentage of global stocks held by the eight major exporters, measured against the secondary vertical axis. Global supplies are set to increase in 2013/14. (DTN graphic by Scott R Kemper)

The wheat market received one blow after another in today's USDA report release, with both U.S. and global ending stocks ending up higher than what was forecast in a Dow Jones pre-report survey. A brief Dow Jones interview with Larry Glenn at Frontier Ag, after the report, quoted him as saying, "When we see how much wheat is flowing through the world, we're just a small part of many countries that have wheat to sell." This is an American speaking to the fact that the U.S. faces stiff competition in the export arena, as does Canada.

Today's report pegged global stocks at 182.78 million metric tonnes, which was above the highest trade estimate, as well as above the November estimate of 178.5 mmt. Ending stocks for 2012/13 are currently reported at 175.83 mmt. Increases in production in both Canada and Australia were largely behind the increase in 2013/14 supplies. While global ending stocks remain below the five-year average, they are well above stock levels in the time period between 2002/03 to 2008/09. 

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While the year-end stocks held by the eight major global exporters are set to grow by 5.6 mmt to 55.19 mmt, or to 30.2% of the total global ending stocks, this number remains below both the five-year and the 10-year averages on both a volume and a percentage basis.

One thing to note is that the USDA's global ending stocks are calculated based on a 3.7% increase in global demand totaling 25 mmt over the 2012/13 crop year forecasts.

Cliff Jamieson can be reached at cliff.jamieson@telventdtn.com

(ES)

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The orange bars represent the trend in world wheat carry-out stocks, while the blue bars show the stocks held by the top eight global exporters, both measured in million metric tonnes on the primary vertical axis. The solid line with markers indicates the percentage of global stocks held by the eight major exporters, measured against the secondary vertical axis. Global supplies are set to increase in 2013/14. (DTN graphic by Scott R Kemper) 
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