Fundamentally Speaking

While a lot of fireworks were generated by the lower-than-expected Sept 1 corn stocks figure and the higher-than-anticipated soybean stocks number, maybe the most surprising and bullish of USDA quarterly stocks and small grains summary figures was a very bullish U.S. 2022 wheat production figure of 1.650 billion bushels (bb) which is down over 133 million bushels (mb) from the USDA's last estimate.

This may be the largest downward revision from the August crop production figures to the end of September grains summary estimate ever as there was reduced output on every class of wheat with HRW down 45 mb, SRW off 44 mb which is even more surprising, and white winter just down 3 mb at 236 mb.

Total U.S. winter wheat crop is now 1.104 bb which is down 94 mb, while other spring wheat production is down 35 mb from the August estimate and durum down 13 mb.

Perhaps the main reason is an enormous 1.254 million acre decline in planted area and an even more stunning 2.0 million plus drop in estimated harvested area from the August crop production figures to the end of September grains summary as these are also likely to be the largest declines in both planted and harvested acreage between these two reports.

This is reflected in the graphic which shows U.S. total wheat production in billion bushels on the left-hand axis and the total U.S. wheat harvested to planted ratio and percent that the final yield was of the 25-year trend on the right-hand axis.

Other than last year's 1.646 bb, this year's wheat production is the second lowest since 1.606 bb in 2002, while drop in both harvested and planted area brings harvested/planting ratio to 77.6% which is lowest since the 76.0% seen in 2002.

This year's harvested acreage at 35.48 million acres is (if I'm reading the record right) the lowest here in the U.S. since 1888.

Finally, though this year's final all wheat yield at 46.5 bushels per acre (bpa) is above the year ago number of 44.3 bpa, it is a second year in a row of well-below trend yields.

(c) Copyright 2022 DTN, LLC. All rights reserved.