The USDA's Magic Numbers #2

The USDA cut the world wheat crop to 645.7 MMT, some 4.3 MMT lower than the 650 MMT that the trade was expecting. That's a reduction of 15.4 MMT on last month.

The main highlights include:

Russia 45 MMT from 53 MMT
Kazakhstan 11.5 MMT from 14.0 MMT
EU-27 137.51 MMT from 141.82 MMT
Ukraine 17.0 MMT from 20.0 MMT

Whilst they are sizable cuts, they are no lower than most of the other estimates already in the market. Indeed they seem to be more like correcting last month's overstates than anything else.

As I noted when last month's figures came out: "Wheat production in Europe was only cut by just over a million tonnes to 141.82 MMT, whilst Russian production was estimated at 53 MMT. Both of those predictions are probably at least 3 MMT, and possibly as much as 5 MMT overstated."