Another WASDE report, how quickly the months do go past.
What does a quick look at the world wheat S&D table for February tell us. Well, not why US wheat futures went up last night. World opening stocks were 120kt lower, production was 2.49mt higher, consumption was a little higher but not enough to counter the increased production and the net result was an increase of 950kt to world ending stocks now estimated at 269.34mt.
Looking through the report at individual countries you start to get a real sense for just how boring this report really is. Half the move higher in world ending stocks are actually an increase in Chinese ending stocks. In recent weeks China has been auctioning off state wheat stocks to keep prices and supply in check, do I find a 500kt increase in Chinese ending stocks dubious…. pfttt, no not at all, especially since the USDA also increased imports by the same amount. So, China is just going to import 500kt to, you know, increase their ending stocks….. This trend rolled through to SE Asia in general, ending stocks increased by 210kt and imports increased by 350kt.
Russian ending stocks were unchanged after the USDA increased production 1mt to 92mt, now only 10mt behind official Russian data, exports and domestic consumption was raised 500kt each to counter this though, so all good.
Seriously, was this report a school project, was it bring your kid to work day, did they just handed little Jonny the texted and said, “go mad son”.
Aussie production was increased 1.4mt to 38mt, ending stocks increased to 5.13mt, getting back up towards pre drought levels again. Argentina was left unchanged across the board; Brazil was left unchanged across the board. India unchanged. Ukraine ending stocks lower by 500kt, exports were increased by 500kt. So, US wheat futures went up on the back of lower-than-expected world ending stocks……….