US Wheat Exports/Stocks

The US only consume around half the wheat it produces, the rest is destined for the export market. If it can find a home, that is, and that is becoming increasingly difficult.

Friday's weekly export sales report for wheat from the USDA threw up a marketing year high figure of 825,800 MT, bringing outstanding sales not shipped yet to 4 MMT, coincidentally exactly the same as a year ago.

What isn't the same as a year ago however is the volume exported so far. At 13 MMT this season's export pace currently lags last season by 5.4 MMT, that's 29%, although the target for the entire year is only 17.5% down on last season.

MMT Exported YTD Year Ago O/s Sales Year Ago Target Year Ago
Wheat 13.0 18.4 4.0 4.0 22.5 27.3
Change -29% unch -17.5%

Thirty three weeks into the marketing year the US has exported just 58% of the USDA's target 22.5 MMT for 2009/10. A year ago the US had already shipped 67% of it's eventual exports of 27.3 MMT.

It seems that the US is going to have to improve some to meet this year's export target. Despite better sales, last week's actual shipments were 316,604 MT, less than the average of around 400,000 MT so far this season. Indeed, to hit the USDA's 22.5 MMT target, the US now has to average half a million tonnes of exports every week for the remaining 19 weeks of the season.

Even if they can manage to do that, this will mean that the US will only have exported 34% of it's wheat crop in 2009/10, just two years ago that figure stood at 61%.

As the US has been finding it progressively harder to sell wheat, stocks have been building. US ending stocks in 2007/08 were 8.3 MMT, or around 15% of total production that season. By the end of 2009/10 those stocks will have climbed to 26.6 MMT, which is equivalent to 44% of production, IF shipments for the remainder of the season match the USDA's target. If they continue to average 400,000 MT/week then ending stocks will reach 28.5 MMT, or 47% of production. That figure is almost exactly equal to the quantity of wheat the US consumed in the whole of 2007/08!

It's not surprising that winter wheat acres are down for next season's harvest when you look at it like that. If consumption was to fall to the levels of two years ago, the US would almost have enough wheat reserves to feed itself for an entire year without producing a single tonne in 2010/11!

MMT 2007/08 2008/09 2009/10* 2009/10**
Production 55.8 68.0 60.3 60.3
Exports 34.3 27.3 22.5 20.6
Exports % of Prod'n 61% 40% 37% 34%
Domestic Usage 28.6 34.3 32.2 32.2
Usage % of Prod'n 51% 50% 53% 53%
End Stocks 8.3 17.9 26.6 28.5
End Stocks % of Prod'n 15% 26% 44% 47%
* basis USDA export target
** basis current export pace