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Every weekday, U.S. Wheat Associates (USW) searches U.S. and global media for news about the U.S. wheat crop and the world wheat market. USW shares the news of the day as a service to our domestic stakeholders. The articles of interest on Monday, April 29, summarized below also have value for our overseas customers.

Wheat Market Rally

A market analysis article presented April 26 on “Farm Journal AgWeb” reached out to Allison Thompson of The Money Farm to describe a 7-day rally in U.S. wheat futures prices while corn and soybean futures declined. Thompson said concerns about dry conditions in the Central and Southern Plains hard red winter (HRW) region as well as southern Russia and western Canada sparked commercial investors to cover long-held short futures positions.

In the April 26 USW Price Report, Market Analyst Tyllor Ledford related news from traders that the futures rally did prompt farmers to sell old-crop wheat. Storms from April 26 to 28 sadly included a deadly, destructive tornado outbreak but also significant rain for some HRW and SRW production regions. So, early on April 29, HRW and soft red winter (SRW) futures were down. The precipitation missed much of western and south-central Kansas, eastern Colorado, and western Nebraska, however.

Image from USW Price Report page describes the latest information on US wheat export market and prices.

The April 26, 2024, USW Price Report noted that farmers increased sales of old crop HRW and HRS wheat during a recent rally in U.S. wheat futures prices.

Spring Wheat

Also on April 26, North Dakota Wheat Commission Director of Policy and Marketing Jim Peterson told “Farm & Ranch Guide” that there are both positive and negative price influences for U.S. hard red spring (HRS) wheat.

Phote of Jim Peterson

Jim Peterson

“On the positive note, it looks like an earlier planting season than a lot of other areas relative to the last few years, so that’s typically yield positive,” he explained. “The reason we’re seeing earlier planting is a lot of areas are abnormally dry to critically dry. If we don’t get a big shift in weather patterns here, we could see some early season moisture stress on the spring wheat region. Then we’ll see what happens with acres. Right now, the forecast is for unchanged total acres nationally, maybe up slightly,” he added.

Despite strong Canadian competition, Peterson said some demand fundamentals support the U.S. spring wheat market. Commercial sales of HRS as of April 25 were 13% ahead of a year ago at 6.40 million metric tons (MMT) and more than USDA’s projections.

Potential Wheat Supply Chain Disruption

Along with the farm and grain handling industries in the Pacific Northwest export system, USW is closely watching the political fight about the potential breaching of four dams on the Lower Snake River. An agricultural media company in the region with a website called AgProud.com published an interview about the debate with Scott Corbitt, General Manager of the Post of Lewiston in Idaho. In the interview, Corbitt describes the value of the port to the region and the overseas customers it helps serve.

U.S. grain handlers purchase wheat from farmers and transport approximately 24 million bushels (0.65 MMT) of wheat by barge through the Port of Lewiston every year, he said, and the companies barge 10% of total U.S. wheat exports through the Colombia Snake River System. Wheat exported from Idaho alone exceeds $300 million annually, Corbitt told AgProud.com. He added that breaching the Lower Snake River dams would result in a huge economic hit for the region disrupt the efficient flow of U.S. soft white (SW), HRS and HRW wheat to export elevators downstream in the Portland area.

 

Ice Harbor Dam on the Lower Snake River System in Washington state.

Read more information on the threat to barging on the Colombia Snake River System online here.

Eye on the Crop

Capital Press” reporter Matthew Weaver recently wrote about how researchers at Washington State University have installed a wheat field camera at the university’s dryland research station in eastern Washington state. The still images taken several times a day of a spring SW wheat field can be viewed online at the research station website and on its YouTube channel.

A spokesperson for the station said the camera is a way for overseas and domestic wheat buyers, as well as non-farmers, to see how the crop progresses and to get more information about sustainable wheat production. The station plans to add short videos about the spring SW wheat crop to the service throughout the growing season and harvest.

The Washington Grain Commission, a long-time USW member organization co-sponsors the “WSU Field Cam.”

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News and Information from Around the World Wheat Industry

Speaking of Wheat

USW received an invitation to meet with Iraqi Prime Minister al Sudani during his trip to Washington, DC. He was accompanied by the Director General of the Grain Board of Iraq, who we met with privately ahead of the meeting with the Prime Minister. This was an opportunity for us to remark to the Prime Minister about USW’s relationship with Iraqi Grain Board and the efforts that USW has extended in our work with Iraq’s flour milling industry going back more than 50 years.” – U.S. Wheat Associates (USW) President Vince Peterson. Read more here.

Ana Laura Salinas Marks 25 Years with USW

Ana Laura Salinas

Ana Laura Salinas

Ana Laura joined the USW Mexico City office in 1999 and serves as Regional Finance and Administration Manager. “Over the past 25 years, Ana Laura has played a pivotal role in the overall financial management of our office,” said USW Regional Vice President, Mexico, Central America, Caribbean, Mitch Skalicky. “She has been a key factor in assuring we are in full compliance with all regulations, policies, and procedures. Beyond that, she plans regional conferences, workshops, and seminars. We highly value Ana Laura’s contributions as a much-appreciated member of the USW/Mexico City team.” ¡Gracias por tu servicio Ana Laura!

Report Cites Indian, Russian, Turkish Trade Barriers

The United States Trade Representatives’ 2024 National Trade Estimate Report on Foreign Trade Barriers includes several concerns from U.S. wheat stakeholders. For example, the report notes that wheat and rice account for the largest share of products procured under the Indian government’s Minimum Support Price (MSP) program, which utilizes highly distorting market-price support. The report shares concerns about Russia’s provision of transportation subsidies for wheat and other products from the interior to export destinations. Concerns also continue about Türkiye’s subsidies, inward processing program for wheat, and its reimbursement of freight costs for certain exports.

The Craft of Wheat Quality

Kansas Wheat publishes an interesting podcast called “Wheat’s On Your Mind.” A recent episode featured a conversation with Kathy Brower, Laboratory Manager for Grain Craft’s Innovation and Quality Lab at the Kansas Wheat Innovation Center in Manhattan, Kan. Noting that wheat is a food ingredient that requires quality control, she explains what makes wheat good or bad from a miller’s perspective. Listen to the podcast here.

International Food Aid Showcase

The United States provides critical foreign humanitarian assistance through international food aid programs administered by USDA and USAID, helping populations in need around the world while supporting U.S. suppliers. On Thursday, May 2, stakeholders from all segments of the U.S. food assistance value chain including USW and the National Association of Wheat Growers will participate in an International Food Aid Showcase at USDA including a panel discussion and interactive displays for networking and collaboration.

Resilience in the Face of Climate Variability

In recent decades, the U.S. wheat market has shown remarkable stability despite facing the growing challenges of climate change and extreme weather conditions. A recent study led by the University of Southampton delves deep into the wheat sector’s resilience and the broader theme of food security in developed countries. The research highlights the crucial role of market forces in maintaining price stability in the food market. Even under the pressures of varying climate conditions, this stability has persisted over the past half-century. Read more here.

Subscribe to USW Reports

USW publishes various reports and content available to subscribe to, including a bi-weekly newsletter highlighting recent Wheat Letter blog posts and wheat industry news, the weekly Price Report, and the weekly Harvest Report (available May to October). Subscribe here.

Follow USW Online

Visit our Facebook page for the latest updates, photos, and discussions of what is going on in the world of wheat. Also, find breaking news on Twitter, video stories on Vimeo and YouTube, and more on LinkedIn.

 

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World durum supplies were tight early in marketing year 2023/24 as drought in the Middle East and Canada and quality issues in the European Union (EU) decreased durum availability and put upward pressure on global durum prices. However, as the marketing year continued, non-traditional durum exports from Russia and Türkiye began flooding markets with low-priced durum, weighing on global durum values.

The following will evaluate the current world durum situation and provide an initial outlook for marketing year 2024/25.

Tight Situation in Major Exporters and Importers

International Grains Council (IGC) data indicated that global durum production decreased by 10% to 31.4 million metric tons (MMT) in 2023/24, and consumption exceeded production by 2.6 MMT, leading to a tight durum balance sheet. In Canada, the world’s largest exporter, durum production fell 30% to 4.0 MMT due to drought in the primary growing areas, as reported in the Canadian Outlook for Principal Field Crops. In the EU, a drought in Spain reduced output, resulting in total EU production of 7.0 MMT, 7% below the previous year, according to IGC. Simultaneously, harvest rains in Italy compromised durum crop quality. As a result, EU durum imports rose by 26% to 3.4 MMT.

The combined impact of decreased durum availability and the increased import requirements supported world durum prices throughout the final quarter of calendar 2023 and into the early months of 2024. In October 2023, French durum prices hovered at $428/MT, U.S. durum (photo above) at $467/MT, and Canadian durum at $450/MT, as reported by IGC, U.S. Wheat Associates, and AgriCensus.

This bar and line chart indicates the relationships and changes in world durum ending stocks, production and consumption from 2015 through projected data for 2025 from the International Grains Council.

Global durum production decreased by 10% to 31.4 MMT in 2023/24, and consumption exceeded production by 2.6 MMT. Meanwhile, ending stocks sit at their lowest level of the last decade at 4.9 MMT. Source: International Grains Council.

Rise of Non-Traditional Exporters

As major exporters’ balance sheets remained tight, Türkiye shifted from a net durum importer to a major exporter. Turkish durum production rose by 15% to a record 4.3 MMT in 2023/24, on a higher planted area and sufficient growing season moisture.

The combination of favorable prices, above-average production, and export focused domestic support programs prompted the Turkish Grain Board (TMO) to authorize the sale of 150,000 MT of durum on February 1, 2024, at prices quoted below market values. On March 7, TMO offered an additional 150,000 MT of durum but canceled the offer as the quoted prices were too low relative to domestic price levels. Nevertheless, Turkish durum exports were estimated at 1.7 MMT for the year as prices remain ultra-competitive relative to other origins. Meanwhile, Stratégie Grains forecasted Russian durum production at 1.3 MMT, with exports projected at 800,000 MT, a 60% increase on the year.

The influx of low-priced Turkish and Russian durum has eroded world durum prices. As of April 16, French durum prices sit at $375/MT, U.S. near $351/MT, and Canadian at $360/MT, down $53, $116, and $90 from October’s prices, respectively.

This bar chart including data from Strategie Grains compares changes in durum exports in 2024 compared to 2023 for 7 countries.

As major exporters’ balance sheets remained tight, Türkiye shifted from a net durum importer to a major exporter. Turkish durum production rose 15% to a record 4.3 MMT in 2023/24. As a result, Turkish durum exports were projected to reach 1.7 MMT. Source: Stratégie Grains.

Will The Patterns Hold?

IGC forecasts a recovery in world durum production in 2024/25 to 34.6 MMT on favorable weather in Canada, EU, and Türkiye. Current estimates suggest Turkish durum production will remain strong in 2024/25 at 4.5 MMT, while exports may exceed 1.0 MMT. It is unknown if Türkiye will rise as a long-term durum exporter, but balance sheets are comfortable in the immediate future.

This line chart compares the elevator bids for US durum compared to hard red spring wheat from 1/1/22 to 4/1/24 indicating higher prices for durum.

Favorable prices for durum relative to spring wheat may incentivize producers to substitute durum acres for HRS, particularly in non-traditional durum growing areas. As of April 16, the average country elevator bid for durum sits at $7.51/bu, a significant spread compared to $6.07/bu for HRS. Source: DTN ProphetX Grain Elevator Bids.

Nevertheless, in the current lower-priced market, U.S. durum remains competitive. U.S. durum exports are up 36% on the year at 504,000 MT on increased imports from Algeria. Moreover, the 2024/25 durum area is forecast to increase by 300,000 acres (121,400 hectares) to surpass 2.0 million acres (809,400 hectares) for the first time since 2018/19. Favorable prices for durum relative to hard red spring (HRS) wheat may incentivize producers to substitute durum acres for HRS, particularly in non-traditional durum growing areas. As of April 16, the average country elevator bid for durum sits at $7.51/bu, a significant spread compared to $6.07/bu for HRS.

The U.S. has and always will be a stable producer and exporter of durum. As world markets shift and adjust, the U.S. has remained a constant supplier, providing reliable, high-quality supplies of durum and other wheat classes on which customers worldwide can rely.

By USW Market Analyst Tyllor Ledford

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Following is an April 17, 2024, announcement from the Iraqi Prime Minister Media Office. Photo above courtesy of the Media Office.

Prime Minister Mohammed S. Al-Sudani met with Mr. Vince Peterson, President of the U.S. Wheat Associates (USW), and his accompanying delegation [April 17, 2024], in the Prime Minister’s residence in Washington D.C. They discussed future cooperation on the supply of high-quality wheat to Iraq at reasonable prices for flour production that can be supplied to the local market outside of the ration card system, which the government has worked to secure and strengthen its strategic reserve, primarily relying on Iraqi wheat.

Prime Minister Al-Sudani highlighted the ongoing cooperation with the U.S. Wheat Associates, praising its efforts in facilitating contracts with the Ministry of Trade and providing wheat during a critical phase when Iraq urgently needed large quantities to bolster its food security. He also emphasized the government’s commitment to continue cooperation with American companies to produce flour for the local market and reduce imports, alongside continued efforts to enhance food security through support for farmers and the private agricultural sector in Iraq.

Hard red winter wheat kernels

Based on the volume of domestic wheat production, the Iraqi Grain Board imports U.S. hard red winter wheat (above) when needed to bolster food security.

The Prime Minister assured that the government would overcome any obstacles to advance cooperation with American companies in supporting this project, meet the local market’s flour needs, and plan for future exports by leveraging the production capacities of private wheat flour producing machines and facilities, many of which have a significant portion of their production lines idle.

Mr. Peterson expressed enthusiasm for further cooperation and future endeavors, noting that the U.S. Wheat Associates has worked with Iraq for decades under the framework of a memorandum of understanding. He expressed pride in the partnership with Iraq.

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In a scene from an August 2023 trade team visit to North Dakota, wheat buyers from Nigeria and Kenya join North Dakota Wheat Commissioner and farmer Scott Huso in one of his fields to get a look at the wheat crop.

In a scene from an August 2023 trade team visit to North Dakota, wheat buyers from Nigeria and Kenya join North Dakota Wheat Commissioner and farmer Scott Huso in one of his fields to get a look at the wheat crop.

Above photo: Idaho wheat farmer and USW Vice Chairman Clark Hamilton talks with members of a South American wheat trade team about his wheat fields during a past trade team visit.

Wheat buyers from Egypt, Japan the Philippines and three other countries are scheduled to visit the U.S. in coming months to seek information about the high-quality wheat crop and meet the people responsible for it.

Indeed, U.S. Wheat Associates (USW) is ready to launch another trade team season.

“Inviting, hosting and leading trade teams is a key piece of the puzzle for our market development activities,” said USW Director of Programs Catherine Miller. “Each trade team season, we look for ways to help U.S. wheat customers learn more about wheat-producing states, the U.S. supply chain system and each of the six wheat classes. It all begins by collaborating with staff in our overseas offices and the state wheat commissions to identify opportunities and put together informative itineraries for the teams.”

Oregon, Minnesota Hosts Egyptian Team

A group of private Egyptian wheat buyers kicks the season off in late April by visiting Oregon and Minnesota. In Oregon, the team will meet staff from USW’s West Coast Office in Portland. It will also tour important export facilities and exporters in the Pacific Northwest. Meetings with the Oregon Wheat Commission and stops at the Federal Grain Inspection Service (FGIS) and the Wheat Marketing Center are also planned. In Minnesota, the team will be presented with a spring wheat update by the North Dakota Wheat Commission. Team members will then meet with exporters and with Minnesota Wheat Research and Promotion Council.

Japan Flour Millers Association to Visit D.C.

Almost simultaneously, nine senior executive members of the Japan Flour Millers Association will visit Washington, D.C., and Oregon. That trade team visit will include meetings at USW headquarters in Arlington, Va., and at USDA. The team will then travel to Oregon, where it will meet with USW, exporters, the Oregon Wheat Commission and the WMC.

The Egyptian and Japanese teams will not be visiting farms. However, the teams that follow throughout the summer are expected to explore the spring wheat crop. A Philippines Team, for example, is scheduled to visit North Dakota, Idaho, Oregon, and Washington in mid-August.

A trade team made up of members of the Japan Flour Millers Association visited Montana farmer Ed Bandel and his son, Jess, in October 2023. USW Japan Country Director Rick Nakano (shown here sharing information with the team) led that trade team.

A trade team made up of members of the Japan Flour Millers Association visited Montana farmer Ed Bandel and his son, Jess, in October 2023. USW Japan Country Director Rick Nakano (shown here sharing information with the team) led that trade team to meet farmers and see wheat research facilities.

Farmers Find Visits Rewarding

Idaho wheat farmer and USW Vice Chairman Clark Hamilton described farm visits as an important event for customers. It is valuable for farmers who host them, too.

“In Idaho, half the wheat we grow is exported, so having customers come here to see our production and our farms is very important,” Hamilton, who hosted a technical trade team from South America in August 2022, said. “I found that it’s a pleasure to have them on the farm and to be able to share with them what we do and how we grow wheat. Many relationships have been built during the trade team season. It’s business, but it’s also personal.”

Goal: Promoting U.S. Wheat

USW invests funding from the USDA Foreign Agricultural Service (FAS) to bring trade teams to the U.S. Participating wheat-producing states connect customers with farmers and industry partners. The goal is straight-forward: to promote the reliability, quality, and value of all six U.S. wheat classes. The teams are shown production and farming practices, how wheat is transported and are able to see various research programs involving wheat.

The visits allow an in-person study of the U.S. wheat industry – from wheat field to export elevator.

“We are able to show our customers that our wheat and the people who supply it – from the farmers to the exporters – are dependable, and that they are focused on producing wheat sustainably,” said Steve Wirsching, Vice President and Director of USW’s West Coast Office.

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The U.S. Wheat Associates’ (USW) Policy Team is busy preparing to host a Japan Trade Team in Washington, D.C. this month. It’s an opportunity for USW Vice President of Policy Dalton Henry and Director of Trade Policy Peter Laudeman to meet face-to-face with valuable customers of U.S. wheat and discuss the U.S. wheat industry.

Last month, Laudeman joined a coalition of U.S. agricultural representatives at the World Trade Organization’s (WTO) Thirteenth WTO Ministerial Conference (MC13) in Abu Dhabi. Trade officials from across the world attended the event to review the functioning of the multilateral trading system and to take action on the future work of the WTO.

In this short video, Laudeman provides an update on the USW Policy Team as the second quarter of 2024 takes shape . . . .

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With U.S. hard red winter (HRW) and hard white (HW) wheat moving into its crucial vegetative state, U.S. Wheat Associates (USW) and its state wheat commission member organizations have started weekly conference calls to share wheat condition reports. Overall, wheat in Central and Southern Plains entered 2024 in better condition than compared to the prior three years. Although recent weather has turned warm, windy, and dry, industry participants remain optimistic for the 2024 crop.

The most recent 2024 USDA Crop Progress report rated 56% of the winter wheat crop in good to excellent condition, up significantly from 27% last year. As of April 8, 6% of winter wheat is headed in the Southern Plains. USDA reported as of April 9, an estimated 18% of all U.S. winter wheat production is within an area experiencing drought.

Latest HRW Wheat Conditions

As usual, Texas leads the way in crop progress with 27% of its HRW and soft red winter wheat headed. At 44% good to excellent, conditions remain encouraging.

In Central Oklahoma, wheat progress continued to benefit from recent rains with 55% at the jointing stage. Good to excellent wheat condition in the state was 68% as of April 7. USW Chair Michael Peters farms northwest of Oklahoma City and reported this week that the condition of his HRW wheat varies from excellent to “just okay.”

Conditions in Kansas are also variable with 49% rated good to excellent. Jason Ochs farms in far western Kansas and recently told Kansas Wheat that it was a nice change to get a good stand right from the start last fall. Yet he also said his topsoil is dry.

“We missed the last three of four moisture chances, so optimism is going down a little bit,” Ochs said. “As of now, it looks like we are going to raise above-average yields. I don’t know how you cannot be a little excited about that.”

Drought has eased for the 2024 U.S. winter wheat crop. On April 18, 2023, 50% of winter wheat production was within an area experiencing drought.

Mixed Bag in Colorado

High winds in eastern Colorado have dried out fields and hurt winter wheat stands.

“Overall things are looking better than they did a year ago at this time,” said Madison Andersen, Colorado Wheat Administrative Committee Director of Communications and Policy. “However, it is a critical time for moisture, especially after the high winds and warm temperatures we have seen the last two weeks.”

In Nebraska, good to excellent winter wheat was at 68% as of April 7, but with the area’s dry and windy conditions, industry representatives say more rain is needed to make the crop. And in Wyoming’s southeastern region, USDA estimates that 91% of the wheat is in fair to good condition. That is up from 63% at the same time in 2023 and from the five-year average for this date of 74% fair to good.

USW will start publishing its 2024 weekly Harvest Reports after the combines start to roll in Texas. Follow the reports, posted every Friday, online here, or sign up here to have Harvest Reports emailed to you.

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News and Information from Around the World Wheat Industry

 

Speaking of Wheat

Consumers and the private sector are increasingly interested in food that is grown in a sustainable, climate-smart way, creating a substantial market opportunity. And, during the past three years, USDA has emerged as a leader in advancing climate-smart agriculture to mitigate and adapt to global climate change.” – USDA Under Secretary for Trade and Foreign Agricultural Affairs Alexis M. Taylor writing on “A Century of Agricultural Trade” for the U.S. Sustainability Alliance, of which U.S. Wheat Associates (USW) is a member. Read more here

Winter Wheat Looking Better This Year

Wheat growing in rows

Winter wheat on April 1, 2024, is in much better condition overall compared to the same time in 2023.

USDA in its first weekly 2024 Crop Progress report suggests U.S. winter wheat is starting the growing season in significantly better shape than it was last year. On April 1, USDA estimated all winter wheat condition at 56% good to excellent, up from a decade-plus low of 28% at the first estimate of 2023. Compared to 36% in 2023, this year 11% of winter wheat was rated poor to very poor on April 1. Read more from Progressive Farmer/DTN here.

Welcoming NAWG Communications Manager

The National Association of Wheat Growers (NAWG) welcomes Elizabeth Rivera as its new Director of Communications and Partnerships. Elizabeth comes to NAWG with excellent experience on Capitol Hill. She earned a bachelor’s of science degree from the University of Oregon. NAWG is the primary policy representative in Washington D.C. for wheat growers, working to ensure a better future for America’s growers, the industry and the general public. Read more here.

Wheat Production 75 Years Ago

High Plains Journal magazine recently published an article that examines “The Evolution of the Wheat Industry Over the Past 75 Years” by Lacey Vilhauer. Noting that USDA has collected data on every U.S. wheat crop since 1918, the article looks back at the 1949 Kansas crop, when farmers seeded 16,244,000 acres (6.57 hectares and 100% more than the 2023 Kansas seeded area) and the average yield was 11 bushels per acre. The pre-Green Revolution crop in 1949 also stood about 1.4 meters tall. Read more here.

Subscribe to USW Reports

USW publishes various reports and content available to subscribe to, including a bi-weekly newsletter highlighting recent Wheat Letter blog posts and wheat industry news, the weekly Price Report, and the weekly Harvest Report (available May to October). Subscribe here.

Follow USW Online

Visit our Facebook page for the latest updates, photos, and discussions of what is going on in the world of wheat. Also, find breaking news on Twitter, video stories on Vimeo and YouTube, and more on LinkedIn.

 

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On March 28, the United States Department of Agriculture (USDA) released its yearly Prospective Plantings and quarterly Grains Stocks reports. The reports provide crucial insights to U.S. wheat importers as we enter the concluding months of the 2023/24 marketing year and look ahead to the 2024 harvest. This article will analyze USDA’s recent reports on wheat planting and stocks and their implications as we look ahead to 2024/25.

Seeding Less

USDA estimates put the total U.S. wheat area at 47.5 million acres (19.2 million hectares), marking a 4% reduction from the previous year.

Breaking down the estimates by class, the area for winter wheat fell by 7% to 34.4 million acres (13.9 million hectares), with Hard Red Winter (HRW) wheat plantings decreasing by 5% on the year, Soft Red Winter (SRW) falling by 15%, and white wheat (winter and spring) decreasing by 2%. Meanwhile, the Hard Red Spring (HRS) area is expected to increase by 2%, while durum may rise by up to 22%.

Bar chart showing seeded area of 5 wheat classes between 15/16 and 24/25.

The 2024 wheat area is forecast at 47.5 million acres (10.2 million hectares), down 4% from 2023 but 500,000 acres (202,350 hectares) higher than the USDA Outlook Forum Estimates. The area consists of 24.3 million acres of HRW (approximately 9.83 million hectares), 6.26 million acres for SRW (about 2.53 million hectares), and 4.2 million acres of white wheat (roughly 1.7 million hectares). The HRS area is projected to reach 10.7 million acres (around 4.33 million hectares), while durum is estimated at 2.0 million acres (approximately 0.81 million hectares). The wheat area is forecast at 47.5 million acres (10.2 million hectares), down 4% from 2023 but 500,000 acres (202,350 hectares) higher than the USDA Outlook Forum Estimates. The area consists of 24.3 million acres of HRW (approximately 9.83 million hectares), 6.26 million acres for SRW (about 2.53 million hectares), and 4.2 million acres of white wheat (roughly 1.7 million hectares). The HRS area is projected to reach 10.7 million acres (around 4.33 million hectares), while durum is estimated at 2.0 million acres (approximately 0.81 million hectares).

When the 2023 U.S. winter wheat crop was seeded in 2022, income potential looked favorable, with prices still elevated by Russia’s invasion of Ukraine. As a result, total seeded wheat area for 2023 was up 8% from the prior year. With current prices falling in line with pre-war trends, and input prices lagging, profit margins have tightened, placing additional pressure on farmers and driving the downward shift in acres. Although the 2024 wheat area is down from last year, the overall area remains 2% higher than the five-year average and represents the second-largest area since the 2018/19 season.

Though the spring wheat and durum is not yet planted, favorable prices for durum relative to spring wheat may incentivize producers to substitute durum acres for HRS, particularly in non-traditional durum growing areas. As of April 3, the average country elevator bid for durum sits at $9.88/bu, a significant jump from an average bid of $5.92 for HRS. The favorable price spreads may push durum area as high as 2.0 million acres (810,000 hectares). If realized this would be the largest durum area since 2018/19.

Crop Competition

Profitability continues to drive crop competition, but an increasing reliance on crop rotations is moderating the impact. Farmers use rotations to reduce price risk and control disease cycles, making them less inclined to make significant acreage adjustments based on price alone.

According to USDA’s estimates, soybean area is anticipated to rise 3% to 86.5 million acres (approximately 34.99 million hectares), aligning with traders’ expectations. Meanwhile, the estimated corn area has decreased 5% to 90.0 million acres (about 36.42 million hectares), falling short of the anticipated 91.7 million acres (226.6 million hectares). However, when considering grain and oilseed acres in the context of all principal field crops, the share of acreage planted with wheat, corn, and soybeans remains relatively stable. Wheat and corn account for 15% and 29% of all acres, consistent with the ten-year average, while the proportion of acres planted with soybeans sits about 1% above the long-term average at 28%.

Line chart shows the number of acres planted to corn, soybeans and wheat annually from 15/16 to 24/25.

The combined area planted with corn, soy, and wheat decreased by 2% to 224 million acres (90.6 million hectares), down from the near-record 228.1 million acres (92.3 million hectares) from the previous year. Even so, the share of acreage planted with corn, soybeans, and wheat remains in line with the five- and ten-year averages. Source: USDA Prospective Planting s Report

Stocks: Up But Still Tight

Also released on March 28, the quarterly USDA Grain Stocks report put total wheat stocks at 29.6 MMT, as of March 1. On-farm stocks were estimated at 7.4 MMT, up 16% from last year, while off-farm stocks came in at 22.2 MMT, up 14% from the year prior. The increased stock levels bolster USDA’s ending stocks estimate of 18.3 MMT, marking an 18% rise from 2023/24 and the first increase since 2015/16. Increased ending stocks helps relieve short term pressure on the U.S. balance sheet.

Moreover, even as planted area is forecast to decrease, the prospects for increased yields and greater wheat production are optimistic as drought conditions improve across the U.S. Southern Plains. The first USDA Crop Progress report of the year indicates that 56% of winter wheat is in good to excellent condition, a significant improvement from 28% at the same time last year. Increased production will help loosen the U.S. balance sheet and diminish supply related price pressures.

Bar chart shows the annual U.S. wheat ending stocks level from 14/15 to 23/24.

On-farm stocks were estimated at 7.4 MMT, up 16% from last year, while off-farm stocks came in at 22.2 MMT, up 14% from last year. The increased stock levels help confirm higher ending stocks for 2023/24. As exports remain lackluster and domestic demand steady, the USDA ending stocks are expected to grow 18% to 18.3 MMT. Source: World Agricultural Supply and Demand Estimates

Nevertheless, underlying tightness remains. U.S. stocks still sit at one of the lowest levels since 2013/14, and with global wheat consumption surpassing production, the global stocks-to-use ratio (excluding China) has dropped to 20%, the lowest point since the 2007/08 season.

More to Come

With a looser balance sheet in the short term tempered by decreased acres, the recent 2024 crop reports provided a mixed sentiment. It is also important to note that USDA’s estimates are based on surveys of U.S. farmers current intensions and may be subject to change as planting ramps up in the coming weeks. With spring wheat planting only 1% completed and winter wheat 4% headed, a definitive statement regarding the 2024 crop is yet to be written.

Moving forward, the May 2024 World Agricultural Supply and Demand Estimates (WASDE) will provide further insights into the 2024/25 marketing year and the July 2024 WASDE will give the initial by-class wheat production estimates. Also, make sure to follow the weekly and monthly reports from USW and USDA on crop conditions, harvest, and production. As always, U.S. Wheat Associates remains committed to offering information and support as we transition into the 2024/25 marketing year.

By USW Market Analyst Tyllor Ledford.

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Response to U.S. Wheat Associates’ (USW) Stories of Stewardship video series is coming from near and far – by farmers here at home who grow wheat and other crops, and by customers of U.S. wheat scattered around the globe.

The reaction is consistent: It’s refreshing to hear from farmers and learn how they help feed the world while also working hard to care for the land.

All Six Episodes Available

The series, which launched in early January with an all-encompassing Episode 1, was followed by episodes featuring five farm families in five different states. Tom Cannon, of Blackwell, Okla.; Ben and Stephanie Bowsher, of Waynesfield, Ohio; Nick Jorgensen, of Ideal, S.D.; Art Schultheis, of Colton, Wash.; and Aaron Kjelland, of Park River, N.D. each told the stories of their family farms over the period of 10 weeks. Each episode was launched on the USW website and on USW’s social media platforms – FacebookX, and LinkedIn – where all six episodes were shared hundreds of times. The videos will remain on the USW website indefinitely.

Sub-titled versions of each episode have been produced in several languages so that USW’s overseas offices can share with customers during meetings, and at events and trade shows.

USW plans to publish written stories to go with each video episode in the near future. It will also continue sharing new stories of how U.S. wheat farmers make efforts to maintain their land for the next generation of farmers.