A quick look at last night’s USDA World Ag Supply and Demand report for wheat shows opening stocks up 1.05mt to 289.87mt, production back 2.18mt to 776.42mt. The reduction in production number is pretty iffy looking and is made up of mostly smaller reductions in a number of producers, the biggest fall being a reduction of 1mt in “selected middle east”. Reductions in the UK, Brazil and Kazakhstan make up the lion’s share of the difference.
Total usage saw a net increase, some did not expect to see this with current high prices and the Russian export tax. The net result was a decrease 1.74mt in world ending stocks, down to 278.21mt. This is a reduction of 11.66mt from the carry in number.  A 4% decrease is great way to start the 2022-23 season, a 20% fall would be better but we’ll take what we can.
The biggest changes were to Canada, the net result a 2mt fall in ending stocks from 5.14mt to 3.14mt. To counter this there was a 1mt increase in Chinese ending stocks to 142.17mt, so realistically the world ending stocks data is probably a little more bullish than it actually reads. Considering the rate of wheat imports China is setting, the 1mt increase in ending stocks there is a little optimistic. The USDA left Chinese wheat imports at 9.5mt.
The punters liked what they saw and US wheat futures made gains in all three grades, the premium grades the bigger gains.
Looking into the report the US breakdown for wheat was not as bullish as the global data. US ending stocks of all grades, were mostly projected to close higher, even white wheat. Let the silly season commence.
Still wondering why Chicago corn is sharply higher, an expected 1mt reduction in Brazil ??