Milling & Baking News - July 24, 2012 - 40

Data 

Encouraging spring wheat outlook overshadowed by corn crop debacle
million bus from its non-survey based forecast in June but up 224,728,000 bus, or 11%, from 1,999,347,000 bus in 2011. But it was the U.S.D.A.’s non-survey based July 11 corn numbers that were the day’s major market feature. In its July World Agricultural Supply and Demand Estimates, the U.S.D.A. slashed its projected 2012 corn yield by 20 bus an acre, to 146 bus an acre, from its June forecast of 166 bus an acre “reflecting the rapid decline in crop conditions since early June and the latest weather data.” “Persistent and extreme June dryness across the central Plains to the Ohio River Valley has substantially lowered U.S. wheat production yield prospects across in thousand bus most of the major 2,500,000 growing regions,” the U.S.D.A. said. 2,000,000 Corn crop condition ratings have continued 1,500,000 to tumble since the U.S.D.A.’s projection. In its latest Crop 1,000,000 Progress report, the U.S.D.A. rated 31% of 500,000 the corn in the 18 major production states in 0 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 good to excellent Durum Winter Other spring Source: U.S. Department of Agriculture condition as of July 15, down from 40% a bus, up 4% from 455,188,000 bus in week earlier and 48% two weeks earlier 2011 but down 12% from the five-year and compared with 66% a year ago. Poor average production near 537 million to very poor ratings grew to 38% in the bus. Production of hard red spring latest week, up from 30% a week earlier wheat was forecast at 435,485,000 and 22% two weeks prior. Mainly as a result of the yield bus, up 10% from 397,689,000 bus in 2011 but down 12% from the five-year reduction, the U.S.D.A. projected average production of 496 million bus. 2012 corn production at 12,970 million It was the U.S.D.A.’s first survey- bus, down 1,820 million bus, or 12%, based forecast of durum and other from 14,790 million bus projected in spring wheat production for the June but up 5% from 12,358 million bus in 2011. The production forecast season. U.S. 2012 winter wheat production included projected harvested area of was forecast at 1,670,346,000 bus, 88.9 million acres, down 200,000 acres down 13,321,000 bus, or 1%, from from the June projection but up 4.9 1,683,667,000 bus forecast in June million acres, or 6%, from 2011. While the trade had anticipated a but up 176,669,000 bus, or 12%, from 1,493,677,000 bus in 2011, the reduction in the U.S.D.A.’s corn yield U.S.D.A. said. Production of hard red forecast, the actual decline far exceeded winter wheat in 2012 was forecast at most trade expectations. Through July 1,009,656,000 bus, down 1% from its 17, nearby September corn futures June forecast but up 229,567,000 bus, prices rallied 75c a bu, or about 11%, or 29%, from 780,089,000 bus in 2011 since the July 11 reports, were up about and 7% above the prior five-year $2.70 a bu, or more than 50% from midaverage production of 942 million bus. June and were up more than 10% from All wheat production in 2012 was a year ago. Although 2012 U.S. wheat production forecast at 2,224,075,000 bus, down 10 WASHINGTON — The U.S. Department of Agriculture in its July 11 Crop Production report estimated 2012 U.S. durum production up 62% and spring wheat other than durum up 4% from 2011, but it was the agency’s sharply reduced 2012 corn yield and production projections released the same day that garnered most of the market’s attention. The U.S.D.A. forecast 2012 durum output at 81,960,000 bus, up 62% from 50,482,000 bus last year but about 2% below the prior five-year average production of 84 million bus. Production of spring wheat other than durum was forecast at 471,769,000
40 / July 24, 2012 Milling & Baking News

was up from a year ago, and there was little if any concern about a shortage of wheat in the United States, soaring corn futures have pulled wheat futures higher in all three major wheat markets. Since midJune nearby September wheat futures prices have surged about $2.50 a bu, or 41% in Chicago, 38% in Kansas City and 33% in Minneapolis. Sharply higher futures prices have prompted increased farmer selling of wheat, with some estimating as much as 60% of the 2012 hard red winter crop has been sold despite recent weaker cash basis levels. The projected carryover of U.S. wheat on June 1, 2013, was forecast at 664 million bus, down 30 million bus, or 4%, from the U.S.D.A.’s June forecast and down 79 million bus, or 11%, from a revised 743 million bus in 2012. The U.S.D.A. projected U.S. wheat imports in 2012-13 at 120 million bus, unchanged from June but up 5 million bus from 2011-12. Total supply for 2012-13 was projected at 3,087 million bus, up 5 million bus from June and up 110 million bus, or 4%, from 2,977 million bus last year. Wheat used for food in 2012-13 was projected at 950 million bus, up 5 million bus from June, up 10 million bus from 2011-12 and equal to the record use in 2000-01. Seed use was unchanged from June at 73 million bus, and down 4 million bus from 2011-12. Feed and residual use in 2012-13 was projected at 200 million bus, down 20 million bus from June but up 31 million bus, or 18%, from 169 million bus in 2011-12. Total 201213 domestic use was projected at 1,223 million bus, down 15 million bus from June but up 3% from 1,186 million bus in 2011-12. Wheat exports were projected at 1,200 million bus in 2012-13, up 50 million bus from June and up 152 million bus, or 15%, from 1,048 million bus last year. Total use was projected at 2,423 million bus, up 35 million bus from June and up 8% from 2,234 million bus in 2011-12. The average price of all wheat paid to farmers in 2012-13 was projected to range from $6.20@7.40 a bu, up 60c on each end of the range from June and compared with a record $7.24 a bu in 2011-12. In its first by-class wheat projections for 2012-13, the U.S.D.A. projected the carryover of hard red winter at 266 million bus on June 1, 2013, down 51 million bus from a lower-revised
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Milling & Baking News - July 24, 2012

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