Wheat: What The USDA Might Say Friday
The USDA are out Friday lunchtime with their latest Supply & Demand numbers and also revised 2009/10 ending stocks.
I don't see there being anything earth-shattering in the figures, with plenty of private estimates already in the marketplace suggesting quite a few tweaks here and there. However when you start to write them all down, it points to some fairly significant changes.
Global wheat production looks a certainty to be revised higher from last month's 663.72 MMT, the IGC for example already have a figure of 666 MMT.
An increase could come for Europe which the USDA have at 138.485 MMT, Coceral currently say 139.56 MMT, so there is potentially a million tonnes extra there. Last month's USDA report pegged US production at 59.428 MMT, with last week's revised small grains report there is potential to add another million tonnes there too.
Russia, there's a good one, the USDA said only 56.5 MMT last time round, which is clearly well below the mark judging by SovEcon's estimate of 60-61 MMT yesterday. I don't think that they will come in that high for fear of highlighting how off-beam last month's figure was. Maybe 59 MMT, so that adds another 2.5 MMT to the global bottom line.
In Canada the USDA only had production at 22.5 MMT last month, 2 MMT under Stats Canada's recent estimate.
Kazakhstan is a bit of a dark horse with the USDA saying 14.5 MMT last month, there's a bit of potential there for an extra half million or so. In Ukraine 20 MMT is also probably on the low side, with 21 MMT nearer the mark.
Argentina is too high at 8 MMT, the Buenos Aires Cereals Exchange now say only 7.1 MMT and the Rosario Grain Exchange 7.4 MMT. With the USDA's 'safety first' approach, half a million off to 7.5 MMT is on the cards there.
If we tot that lot up we have an extra 4.5 MMT from Europe, the US and Russia, 2 MMT from Canada, plus say a further million from Kazakh/Ukraine less a half from the Argies, that's seven million tonnes that they could easily 'find' from last month.
That might frighten them a bit, so I'll go for an extra 5 MMT getting added to the bottom line.
With all this extra production, some tweaking of global consumption and ending stocks is also on the cards. Usage in India could certainly increase due to sharply lower summer crop production. They might also pencil in a bit of extra consumption in Europe with low prices stimulating demand and increased usage next year from the biofuel sector.
Even so, global ending stocks will probably rise by 3 MMT or so from last month's 186.61 MMT.
For US 2009/10 ending stocks, although weekly exports have held up quite well the past few weeks, the expected increase in US production will almost certainly add to those too. Potentially finding another 5 MMT+ globally will hardly improve the outlook for US exports either.
The USDA's September estimate of 743 million bushels seems likely to be pushing the 800 million mark by Friday afternoon.
I don't see there being anything earth-shattering in the figures, with plenty of private estimates already in the marketplace suggesting quite a few tweaks here and there. However when you start to write them all down, it points to some fairly significant changes.
Global wheat production looks a certainty to be revised higher from last month's 663.72 MMT, the IGC for example already have a figure of 666 MMT.
An increase could come for Europe which the USDA have at 138.485 MMT, Coceral currently say 139.56 MMT, so there is potentially a million tonnes extra there. Last month's USDA report pegged US production at 59.428 MMT, with last week's revised small grains report there is potential to add another million tonnes there too.
Russia, there's a good one, the USDA said only 56.5 MMT last time round, which is clearly well below the mark judging by SovEcon's estimate of 60-61 MMT yesterday. I don't think that they will come in that high for fear of highlighting how off-beam last month's figure was. Maybe 59 MMT, so that adds another 2.5 MMT to the global bottom line.
In Canada the USDA only had production at 22.5 MMT last month, 2 MMT under Stats Canada's recent estimate.
Kazakhstan is a bit of a dark horse with the USDA saying 14.5 MMT last month, there's a bit of potential there for an extra half million or so. In Ukraine 20 MMT is also probably on the low side, with 21 MMT nearer the mark.
Argentina is too high at 8 MMT, the Buenos Aires Cereals Exchange now say only 7.1 MMT and the Rosario Grain Exchange 7.4 MMT. With the USDA's 'safety first' approach, half a million off to 7.5 MMT is on the cards there.
If we tot that lot up we have an extra 4.5 MMT from Europe, the US and Russia, 2 MMT from Canada, plus say a further million from Kazakh/Ukraine less a half from the Argies, that's seven million tonnes that they could easily 'find' from last month.
That might frighten them a bit, so I'll go for an extra 5 MMT getting added to the bottom line.
With all this extra production, some tweaking of global consumption and ending stocks is also on the cards. Usage in India could certainly increase due to sharply lower summer crop production. They might also pencil in a bit of extra consumption in Europe with low prices stimulating demand and increased usage next year from the biofuel sector.
Even so, global ending stocks will probably rise by 3 MMT or so from last month's 186.61 MMT.
For US 2009/10 ending stocks, although weekly exports have held up quite well the past few weeks, the expected increase in US production will almost certainly add to those too. Potentially finding another 5 MMT+ globally will hardly improve the outlook for US exports either.
The USDA's September estimate of 743 million bushels seems likely to be pushing the 800 million mark by Friday afternoon.
