By Keith Good, University of Illinois’ FarmDoc program
In its monthly Wheat Outlook report yesterday, the USDA’s Economic Research Service (ERS) indicated that, “U.S. Hard Red Winter (HRW) exports are forecast down 10 million bushels this month to 155 million bushels, the lowest since records started in 1973/74. HRW supplies have seen a long-term downturn in U.S. acreage as corn and soy have gained acreage in many locations. At the same time, international wheat competition has surged, resulting in exports of this class being less competitive on the global market.
“Recently, U.S. HRW supplies have been affected by drought in consecutive years, which has dented crop prospects and contributed to exports of this class being uncompetitive with other suppliers such as Russia and the European Union (EU). Historically, HRW was the leading class of U.S. exports, but in this season, it is forecast as the third largest class of U.S. exports, being surpassed by both Hard Red Spring (HRS) and White wheat. Production of HRS and White are down year-over-year with lower yields, but drought has not affected those classes to the same extent as HRW.”
ERS pointed out that, “U.S. exports continue to be priced uncompetitively on the global market, resulting in a slow pace of sales. U.S. export sales, as reported in the USDA, Foreign Agricultural Service (FAS) U.S. Export Sales report, are well behind last year’s pace through August 31. Total U.S. commitments (the sum of accumulated exports and outstanding sales) are at 7.9 million metric tons as of August 31, down 21 percent from the same point last year.
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