Milling & Baking News - August 29, 2006 - 30

N E W S F E AT U R E

million bus from 2006 and the for the following crop year.
"If the hard red winter wheat belt resmallest since 1996. Production of
all wheat in 2006 was estimated at ceives enough moisture to support the
1,801 million bus, down 304 mil- anticipated 7% to 10% increase in planted
lion bus from 2005 and the smallest acreage, prices will remain below the
outturn since 2002. Domestic wheat July highs of $5.39 per bu, basis Decemsupply in 2006-07 was projected at ber Kansas City wheat. However, with2,474 million bus, down 253 million out the needed moisture, prices could
bus from the previous year. Domes- resume the uptrend."
Most analysts expected an increase in hard
tic use was projected at 1,140 million
bus, down 9 million bus from 2005- winter wheat acreage for harvest in 2007.
"The wheat belt has received general
06. Exports were projected at 900
million bus, down 109 million bus rains over the past 30 days," said Bart
Brummer, senior wheat merchandiser,
from 2005-06.
'96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06
If anything, world wheat stocks The Scoular Co., Indianola, Iowa. "That
Source: U.S. Department of Agriculture
were even more worrisome than the should ease the pressure on the July 2007
tight U.S. supply. The U.S.D.A. on futures contract to bid for planted acres.
the smallest crop since 2002 and com- Aug. 11 projected 2006-07 world wheat Producer interest in selling 2007 wheat
pared with 918 million bus as the recent ending stocks at 128.42 million tonnes, should pick up as we draw nearer plant10-year average outturn.
down 17.27 million tonnes from
The sub par production will result in 145.69 million tonnes in the preWorld wheat ending stocks
this year 's supply of hard wheat (hard vious year. World wheat produc& stocks-to-use ratio
red winter wheat and hard red spring tion in the current year was prowheat combined), projected at 1,471 mil- jected at 598 million tonnes, down
40%
220
lion bus, being the smallest since the 20.46 million tonnes from 618.46
Stocks-to-use
1974-75 marketing year, according to the million tonnes in 2005-06. World
Ending stocks
35%
190
U.S.D.A. Hard wheat ending stocks for consumption of wheat in 2006-07
2006-07 were projected at 236 million was projected at 615.27 million
bus, the smallest since 1973-74.
tonnes, down 8.94 million tonnes
30%
160
By class, the hard red winter wheat from 624.21 million tonnes in the
supply in 2006-07 was projected at 873 previous year.
million bus, down 250 million bus, or
At 128.42 million tonnes, 200625%
130
22%, from the previous year. The hard 07 world wheat ending stocks
red spring wheat supply was projected would be the smallest since
20%
100
at 598 million bus, down 40 million bus 1981-82. The world wheat end'98-'99 '00-'01 '02-'03 '04-'05 '06-'07
from 2005-06.
ing stocks-to-use ratio this year
Source: U.S. Department of Agriculture
With 2006-07 hard winter wheat domes- was projected at 20.9%, the tighttic use projected at 450 million bus and est in records extending back to 1960-61. ing time. The market expects near record
exports at 300 million bus, the carryover The next-tightest stocks-to-use ratio was hard red winter wheat plantings."
of hard red winter wheat on June 1, 2007, 21.3% in 1972-73.
Joe Christopher of Crossroads Comwas projected at 123 million bus, down
modities, Sidney, Neb., said he expected
89 million bus from 2006 and the smallest '07 production prospects a factor
an increase in hard winter wheat area,
Mr. Freed said tight U.S. and global but not as large as many have suggested.
in records extending back to 1961.
The 2007 hard red spring wheat car- wheat stocks won't matter so much if
"I predict there will be only about 2
ryover was projected at 113 million bus, world weather is normal this fall and million more acres seeded than in 2005,"
down 18 million bus from 2006 and the next spring.
he said. "Some are looking for 3 million
"But we could have $6 a bu wheat if to 4 million acres more. An increase of
smallest since 1996. Domestic use of hard
red spring wheat in 2005-06 was project- there is a production hiccup anywhere," only 1 million to 1.5 million acres would
ed at 220 million bus. Exports were pro- he said. "The Northern Hemisphere be disappointing. We need an increase of
did not grow a good crop. And South- 2 million acres to take the pressure off
jected at 265 million bus.
In contrast, soft red winter wheat pro- ern Hemisphere production prospects the market. High corn prices will limit
duction, estimated at 380 million bus, are stressed. We need a break. We need the wheat acreage increase. But high corn
was up 71 million bus from 2005. The soft a more normal Northern Hemisphere prices also will help keep wheat prices
red winter wheat 2007 carryover was pro- weather pattern, including in the hard strong. Hard red winter at $4 a bu to the
jected at 112 million bus, up 6 million bus winter wheat states this fall, or prices farmer should secure more acreage. Profrom 2006. Soft red was the only wheat could go crazy."
ducers can sell $4 wheat through 2008."
Mr. Bresnahan said, "Three years in the
class projected to have a year-to-year increase in carryover stocks. Domestic use past that had the smallest combined hard Cash wheat in seasonal pattern
Cash wheat premiums in both Kansas
of soft red winter wheat in 2006-07 was red winter and hard red spring crops
projected at 274 million bus, and exports were 1988-89, 1989-90 and 2002-03. In City and Minneapolis peaked in June,
each of these crop years, U.S. prices were declined through July and began to adwere projected at 120 million bus.
The 2007 carryover of all wheat was greatly influenced by the amount of in- vance again just the past few weeks. The
projected at 434 million bus, down 134 creased winter wheat acreage in the U.S. movement in cash wheat markets reflected

380

197
208
209
207
203

128

133
151
146

166

30 / Milling & Baking News, August 29, 2006

in per cent

in million tonnes

309

380

321

380

397

469

452

443

420

in million bus

472

Soft red winter
wheat production

bakingbusiness.com / world-grain.com

http://www.bakingbusiness.com http://www.world-grain.com

Milling & Baking News - August 29, 2006

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