🥇 First rule of investing? Know when to save! Up to 55% off Investing Pro before BLACK FRIDAYCLAIM SALE

2024/25 U.S. Wheat Faces Supply Challenges Amid Global Production Shifts

Published 13-08-2024, 02:37 pm
2024/25 U.S. Wheat Faces Supply Challenges Amid Global Production Shifts
ZW
-

The 2024/25 U.S. wheat outlook indicates a drop in supplies due to lower harvested area and production, while domestic use sees a slight uptick. Globally, wheat production is expected to rise, driven by increased output in Ukraine, Kazakhstan, and Australia. However, global ending stocks are projected to decline to their lowest level since 2015/16.

Highlights

Lower U.S. Wheat Supplies: The 2024/25 U.S. wheat outlook shows reduced supplies due to lower production, with a decrease of 26 million bushels, despite a slight increase in average yield per acre.

Harvested Area Reduction: U.S. wheat harvested area is lowered by 0.9 million acres to 37.9 million, which is only partially offset by an increase in the yield, now at 52.2 bushels per acre.

Mixed Wheat Class Production: Production of Hard Red Spring, Durum, and Soft Red Winter wheat decreased, while Hard Red Winter and White wheat production increased, affecting overall supply dynamics.

Increased Domestic Use: Domestic use of U.S. wheat is slightly raised by 2 million bushels, driven primarily by higher food use as indicated in the NASS Flour Millings Products report.

Lower Ending Stocks: The projected U.S. wheat ending stocks for 2024/25 are reduced by 28 million bushels to 828 million, reflecting tighter supply and steady demand.

Stable Farm Price: The season-average farm price for U.S. wheat remains unchanged at $5.70 per bushel, despite fluctuations in supply and demand projections.

Global Supply Increase: The global wheat outlook for 2024/25 anticipates increased supplies, mainly due to higher production in Ukraine, Kazakhstan, and Australia, offsetting reductions in the EU and the U.S.

Record Global Consumption: Global wheat consumption is forecasted to reach a record 804.0 million tons, driven by higher feed and residual use in the EU, Kazakhstan, and Ukraine.

Higher World Trade: World wheat trade is projected to increase by 2.0 million tons to 214.9 million, with Australia and Ukraine expected to be the primary contributors to the export growth.

Declining Global Stocks: Global ending stocks for wheat are expected to decrease slightly by 0.6 million tons to 256.6 million, marking the lowest level since the 2015/16 season.

Conclusion

The 2024/25 wheat market presents a mixed scenario, with the U.S. facing tighter supplies and reduced ending stocks, despite stable farm prices. Global production is set to increase, but the continued decline in global ending stocks could support prices in the long term. Monitoring production trends and demand shifts will be crucial for navigating the wheat market in the upcoming season.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.