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USDA August world grain bulletin

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The USDA (United States Department of Agriculture) Foreign Agricultural Service (FAS) has just released its August bulletin on world grain. It has made an effort to quell fears of a worldwide grain shortage by headlining the main report “No global shortage of food grains”, but the numbers provided indicate the reality at work. I have excerpted the important paras of the Grains report and the World Agricultural Production report. Also look at the table for wheat totals.

“Expectations that prices in the next few months will hit the record levels of 2007/08 levels are not substantiated by the reality of the global supply situation. Black Sea (Russia, Ukraine, Kazakhstan) wheat exports are expected to plummet 60 percent (21 MMT) on drought-reduced crops. However, traditional exporters, particularly the United States, are holding large supplies that are more than sufficient to compensate for the Black Sea shortfall. In fact, U.S. ending stocks at 26 million tons are three times larger than just a few years ago.”

Russia Wheat: Drought Has Reduced Yield by 40 Percent in Key Production Regions – “The USDA forecasts Russia wheat production for 2010/11 at 45.0 million tons, down 8.0 million or 15 percent from last month and down 16.7 million or 27 percent from last year. Area is estimated at 26.7 million hectares, down 0.1 million from last month due to a slight reduction in estimated winter wheat area. Winter wheat accounts for slightly less than half of the total wheat area but almost two-thirds of production due to higher yields. Yield is estimated at 1.69 tons per hectare, down 15 percent from last month, and down 19 percent from the five-year average. Severe and persistent drought has sharply reduced yield prospects in Russia’s Central, Volga, and Ural Districts. The Central District produces mostly winter wheat, and the Volga and Ural Districts produce mostly spring wheat.”

“Ministry of Agriculture harvest data from August 4 indicates that wheat yield is down 39 percent from last year in the Volga District, with harvest about 40 percent complete, and down 37 percent in the Central District, with harvest about 80 percent complete. The drought has extended into the western regions of Siberia, but conditions in Altai Krai, Siberia’s top wheat-producing territory, are reasonably good. Wheat harvest has not yet begun in the Ural or Siberian Districts. Wheat in the Southern and North Caucasus Districts largely escaped significant drought-related damage. These two districts are located in southern European Russia and typically produce about half of Russia’s winter wheat. Harvest reports show yields up 6 percent in the Southern District and up 8 percent in the North Caucasus District with harvest about 80 to 90 percent complete.”

EU Wheat Production Lower by 4.3 Million Tons Due to Rain, Dryness – “USDA estimates the 2010/11 European Union (EU) wheat crop at 137.5 million tons from 25.6 million hectares. The August production estimate is reduced 4.3 million tons or 3 percent from July. With area unchanged, yield dropped from 5.53 to 5.36 tons per hectare. Compared to last year, production is down 0.7 million tons or 0.5 percent while area is down 0.1 million hectares or 0.4 percent. The wheat crop suffered from a dry spring and early summer in the western EU countries and from excessive precipitation in the eastern countries. France, the EU’s largest wheat producer is now estimated to have harvested 37.5 million tons, 0.5 million less than last month and 0.8 million less than last year, even though area is up 5.5 percent from last year. Dryness has reduced France’s 2010/11 yield estimate to 6.91 tons per hectare versus 7.45 tons last year.”

“Germany’s crop is still being harvested, and is estimated at 24.0 million tons, down 1.5 million or 6 percent from last month and 5 percent from last year. Unfavorable dryness was followed by excessive precipitation. The impact of the dryness was exacerbated in areas with light soils and contributed to the estimated German yield reduction to 7.23 tons per hectare, compared to 7.81 tons reached in 2009/10. Near-record amounts of rainfall fell during the wheat harvest in southeastern Europe, lowering yields and quality. Hungary’s wheat crop estimate is reduced by 0.8 million tons from last month to 4.0 million tons, which is down 9 percent from last year. Romania’s crop is reduced 0.65 million tons to 6.2 million tons, 17 percent below last year, and Bulgaria’s crop is reduced 0.4 million from last month to 3.6 million tons, down 10 percent from last year.”

All Grain Summary Comparison – mt
Wheat Rice Milled Corn
08-09 09-10 10-11 08-09 09-10 10-11 08-09 09-10 10-11
Production
United States (Jun-May) 68 60.3 61.6 6.4 6.9 7.7 307.1 333 339.5
Other 615.2 620 584.1 441.6 435.7 451.5 490.7 475.4 492.1
World Total 683.3 680.3 645.7 448 442.6 459.2 797.8 808.4 831.6
Domestic Consumption
United States (Jun-May) 34.3 30.9 32.3 4 4 4 259.3 289.3 290.6
Other 601.8 619.6 629.9 431.9 431.8 450 520.4 523 539.6
World Total 636.1 650.5 662.2 435.9 435.8 454 779.7 812.3 830.2
Ending Stocks
United States (Jun-May) 17.9 26.5 25.9 1 1.1 1.8 42.5 36.2 33.3
Other 147.6 167.5 148.8 89.9 93.9 95.7 105 102.8 105.9
World Total 165.5 194 174.8 90.9 95 97.5 147.5 139 139.2
TY Imports
United States (Jun-May) 3.5 3.3 2.7 0.7 0.7 0.7 0.3 0.2 0.3
Other 136.7 126.4 119.2 26.1 27.6 28.1 82.1 85.4 88.9
World Total 140.2 129.6 121.9 26.8 28.3 28.8 82.5 85.6 89.2
TY Exports
United States (Jun-May) 27.3 24.2 33 3 3.5 3.5 47.8 50 52
Other 115.8 108.5 91.5 26.3 26.6 27.9 36.2 37.8 39.4
World Total 143.1 132.6 124.5 29.3 30.1 31.3 84 87.8 91.4
All Grain Summary Comparison – mt
Wheat Rice Milled Corn
2008/09 2009/10 2010/11 2008/09 2009/10 2010/11 2008/09 2009/10 2010/11
Production
United States (Jun-May) 68 60.3 61.6 6.4 6.9 7.7 307.1 333 339.5
Other 615.2 620 584.1 441.6 435.7 451.5 490.7 475.4 492.1
World Total 683.3 680.3 645.7 448 442.6 459.2 797.8 808.4 831.6
Domestic Consumption
United States (Jun-May) 34.3 30.9 32.3 4 4 4 259.3 289.3 290.6
Other 601.8 619.6 629.9 431.9 431.8 450 520.4 523 539.6
World Total 636.1 650.5 662.2 435.9 435.8 454 779.7 812.3 830.2
Ending Stocks
United States (Jun-May) 17.9 26.5 25.9 1 1.1 1.8 42.5 36.2 33.3
Other 147.6 167.5 148.8 89.9 93.9 95.7 105 102.8 105.9
World Total 165.5 194 174.8 90.9 95 97.5 147.5 139 139.2
TY Imports
United States (Jun-May) 3.5 3.3 2.7 0.7 0.7 0.7 0.3 0.2 0.3
Other 136.7 126.4 119.2 26.1 27.6 28.1 82.1 85.4 88.9
World Total 140.2 129.6 121.9 26.8 28.3 28.8 82.5 85.6 89.2
TY Exports
United States (Jun-May) 27.3 24.2 33 3 3.5 3.5 47.8 50 52
Other 115.8 108.5 91.5 26.3 26.6 27.9 36.2 37.8 39.4
World Total 143.1 132.6 124.5 29.3 30.1 31.3 84 87.8 91.4

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