Farmers Await Winter Wheat Plantings Data


The U.S. Department of Agriculture is not expected to stray away from its current estimate for 2009-10 wheat ending stocks, following

sluggish old-crop sales activity amid ample U.S. and global supplies.

An updated carryout and production forecast is expected in the USDA’s May production and supply and demand report, due out at 8:30 a.m. EDT (1230 GMT) Tuesday. The industry is expected to look closely at winter wheat production estimates, as USDA’s first survey will give production outlooks a little merit.

The average of analysts’ estimates for the 2009-10 carryout is 950 million

bushels, unchanged from April, according to a Dow Jones Newswires survey of 17 analysts. In 2008-09, carryout was 657 million. Ending stocks, also called carryout, refers to the amount of grain left after all supply and demand factors have been taken into account.

Of the 17 analysts surveyed, 10 expected no change, four expected an

increase and three expected a decrease. The range of estimates was 886 million bushels to 971 million bushels.

Overall, the trade expects little change in the old-crop balance sheet, and

regardless of a modest upward or downward adjustment in the USDA ending stocks forecast, carryover stocks will be bountiful, industry observers said.

End users have been content to sit back on purchasing old-crop supplies,

particularly with no scarcity of world inventories.

2010-11 Wheat Supplies Seen Ample 

The average estimate among 18 surveyed analysts for 2010-11 ending stocks was 961 million bushels. The new crop year for wheat begins June 1.

Despite lower year-over-year production declines, and a struggling soft red

winter wheat crop, U.S. and world supplies will remain ample, said Shawn

McCambridge, senior grains analyst with Prudential Bache in Chicago.

Winter wheat production in 2010-11 is seen dropping from 2009’s output.

The average production estimate among 10 surveyed analysts for all winter wheat production was 1.434 billion bushels. This is down from 1.523 billion bushels in 2009, according to the USDA. The average 2010 hard red winter wheat estimate is 920 million bushels, on par with 919 million bushels in 2009. The average 2010 soft red winter estimate is 303 million bushels, down from 404 million bushels in 2009. The average 2010 white winter estimate is 205 million bushels, up from 200 million bushels in 2009.

The market is currently digesting some big crop ratings for hard red winter

wheat crops, but smaller 2010 winter wheat acreage will offset any increases in yields, McCambridge added.

“Low prices in the past year and a poor fall seeding period led to a second

sharp drop of 13{4d08edaf359bc2115b18a651716ebd427a137946ddca2143fa23b3ea721061e4} in U.S. winter wheat seedings last fall, compared to a 7{4d08edaf359bc2115b18a651716ebd427a137946ddca2143fa23b3ea721061e4} decline in 2009,” said Jerry Gidel, analyst with North America Risk Management Services, in a research note.

This is the lowest U.S. winter wheat plantings since 1970.

“Moderate weather conditions, both in the U.S. and in the major wheat

growing regions of the world, as well as a modest world economic outlook

suggests this food grain’s supplies will likely remain adequate in the upcoming year,” Gidel said.

Source: DTN

Posted by Russell Nemetz

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