The U.S. Department of Agriculture (USDA) released its September Supply and Demand Report on September 10:
Wheat: Global Wheat Production and Year-End Stocks Forecast Revised Upward
In its September Supply and Demand Report, the U.S. Department of Agriculture raised its forecasts for global wheat supplies, ending stocks, and production in the 2021-22 marketing year. Specifically, the global wheat supply estimate for 2021-22 was increased by 7.1 million tons to 1.073 billion tons—largely due to higher beginning stocks in countries like Canada, the European Union, and India, as well as increased yields in Australia, India, and China.
The USDA has raised its global wheat production forecast for the 2021/22 marketing year to 780.3 million tons, up from the August estimate of 776.9 million tons, driven by anticipated increases in production from Australia, China, and India. Specifically, the U.S. Department of Agriculture boosted Australia’s wheat output projection to 31.5 million tons—1.5 million tons higher than the August outlook—and noted that this would mark Australia’s third-highest wheat yield on record. Meanwhile, China’s wheat production is now projected at 136.9 million tons, slightly above the August estimate of 136 million tons, while India’s output has been revised upward by 1.5 million tons to 109.5 million tons.
As supply is expected to rise, the global year-end inventory forecast has also been revised upward—from 279.06 million tons in August to 283.22 million tons. This marks the first time this current market year that the USDA has increased its production estimate. Last month, FOB prices for wheat from Russia, Australia, and Ukraine surged amid expectations of shrinking supplies. According to S&P Global Platts assessments, Australian APW-grade wheat FOB prices climbed by 12% during the month, reaching $324.5 per ton. Meanwhile, Russian wheat with a protein content of 12.5% saw its FOB price jump by 9%, climbing to $303.5 per ton, while Ukrainian wheat boasting 11.5% protein content rose by 8.4%, settling at $291.5 per ton.
The U.S. Department of Agriculture reported that global consumption for the 2021-22 marketing year is projected to rise by 3 million tons, reaching 789.6 million tons.
Global wheat trade for the 2021-22 season is projected to rise by 1.5 million tons, reaching 199.7 million tons—driven primarily by increased shipments from Australia and India, which more than offset the decline in Canadian exports. Australia’s export forecast has been revised upward from last month’s 22 million tons to 23 million tons. Meanwhile, the U.S. Department of Agriculture now estimates India’s wheat exports at 3.5 million tons, up from last month’s projection of 2.7 million tons. However, the USDA has lowered its forecast for Canada’s wheat exports in 2021-22 by 500,000 tons, bringing the total down to 17 million tons.
Corn: U.S. corn production expected to reach the second-highest level on record; global corn production, consumption, and inventories revised upward.
In its September Supply and Demand Report, the U.S. Department of Agriculture (USDA) raised its corn production forecast by 1.7%, as farmers planted more corn acreage than previously reported. The projected U.S. corn output for the 2021/22 marketing year is now estimated at 14.996 billion bushels, making it the second-highest on record. This estimate is based on an average yield of 176.3 bushels per acre. Meanwhile, the projected corn planting area was revised upward from 92.7 million acres in August to 93.3 million acres.
The U.S. Department of Agriculture stated that, due to persistently low hog prices, it has lowered its forecast for China's corn consumption in 2021/22, which is primarily used as animal feed. (Industry Watch: Outrageous! Piglet prices have collapsed, sending pork prices plummeting across many regions! But who exactly is the real savior of the pig market? )
The global corn production for the 2021/22 season is estimated at 1.198 billion tons, compared to 1.117 billion tons in the previous year. Meanwhile, ending stocks are projected to rise from 286 million tons in the prior year to 298 million tons.
Rice: Global rice production and stocks revised upward, while consumption is lowered.
Global rice production for the 2021/22 season is estimated at 508 million tons, compared to 506 million tons in the previous year. Meanwhile, end-of-season stocks are projected to decline from 186 million tons last year to 182 million tons this year.
Soybeans: U.S. soybean production expected to reach the third-highest on record, with global production and inventories also revised upward.
The U.S. Department of Agriculture’s September Supply and Demand Report projects that U.S. soybean production for the 2021/22 marketing year will reach 4.374 billion bushels, with an average yield of 50.6 bushels per acre. If realized, this would mark the third-highest soybean production on record, while the yield would tie for the second-highest ever recorded.
The estimated U.S. soybean planting area for the 2021/22 marketing year is 87.2 million acres, compared to the August estimate of 87.6 million acres. Meanwhile, the projected soybean harvest area for the 2021/22 season is 86.4 million acres, slightly below the market’s earlier forecast of 86.7 million acres—and also in line with the August projection of 86.7 million acres.
The global soybean production for the 2021/22 season is estimated at 384 million tons, compared to 363 million tons in the previous year. Soybean crushing volume is projected at 329 million tons, up from 318 million tons in the prior year. Meanwhile, ending stocks are forecast to rise from 95.08 million tons in the previous year to 98.89 million tons.
