The May USDA World Ag Supply and Demand Estimate report held data estimates for the 2024-25 world wheat crop for the first time. The data was not bearish wheat at all. When looking at the stocks to use ratio for major exporters it starts to drive home just how tight things are getting and how current values and poor gross margins are, and have been, discouraging huge wheat crops for some time.
Russia may be the exclusion to this as their currency when converted from US dollars does offers solid local value for producers. The counter to this though is the cost of imported inputs.
Back to the data, new crop wheat production is estimated at 798.19mt, this is an increase to 2023-24, which was increased a little month on month to 787.72mt. Lower carry out stocks for 2023-24 roll through to net 2.15mt lower availability year on year from the start, even with the larger production estimate.               Resulting in a net decline in the global stocks to use ratio of about 1%. Not great but better than an increase. The big change is in carry out from the major exporters, the 2023-24 carry out is pegged at 40.46mt versus 31.71mt for 2024-25. An issue for a major exporter / importer will create a lot of volatility.
Drilling down into the production estimates for the 2024-25 crop shows that Russia is pegged at 88mt, possibly a little higher after recent frosts. Australia 29mt, Argentina 17mt. Argie exports might be the thing to watch going forward. 2023-24 exports are pegged at 10mt, new crop 11.5mt. This should correlate a lot with what happens in Brazil going forward. Last year Brazil imported 5.7mt of wheat, after producing 8.1mt. The new season estimate is for production at 9.5mt and imports of 5.5mt. After recent flooding across the major wheat production regions of Brazil the production estimate may already be questionable.
Ukraine 21mt for new crop vs 23.4mt for the old crop. China is there at 140mt, India is there at 114mt. The USA is expected to recover a little to 50.56mt, potentially also a little questionable given the current crop ratings in the HRWW belt.
Current crop soybeans for Brazil were left at 154mt, that’s questionable given the recent flooding, new crop 169mt !!!