USDA report causes euphoria: Grain prices are rising sharply

The USDA cut global wheat production by 2.0 million tons to 792.4 million: but this is still a new production record. Russia’s production decreased by 1.0 million tons to 85.0 million tons.

The Russian winter wheat crop fell by 0.5 million tons to 64.0 million tons due to the smaller harvest area due to winter damage and spring frosts. The Russian summer wheat crop also decreased by 0.5 million tons to 21.0 million tons due to hot and dry conditions in central Russia.

The summer wheat crop in Kazakhstan will be revised downward by 1.0 million tons to 13.0 million tons under similar adverse conditions. The US wheat crop fell by 4 million tons to 47.5 million tons due to heat-related failures in summer wheat.

The wheat harvest in the 27 EU countries and the UK increased by 1.4 million tons to 138.2 million tons and 14.8 million tons, respectively, due to favorable conditions in northern and central Europe.

The projected global consumption for 2021/202 is slightly lower at 790.9 million as less forage wheat is used in Russia, the United States and Kazakhstan. Global trade forecast in 2021/202 will increase by 0.8 million tons to a record high of 204.0 million tons as higher exports from the EU, Ukraine and Australia offset declines in Canada, Kazakhstan and the United States.

Projected global final stocks for 2021/22 will be reduced by 5.1 million tons to 291.7 million, but will still be higher than the previous year.

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