Milling & Baking News - May 31, 2022 - 22

TUES | 05 31 202 2
CONTINUED FROM PAGE 1
War, weather, freight, pandemic
cloud outlook for grains and oilseeds
Strong demand for limited supplies supports high prices
United States as the largest-produced
grain, wheat has drawn heightened attention
because it is a leading food grain,
second only to rice globally, as opposed
to corn which is more of a feed and fuel
grain. The Ukraine war disrupted global
wheat supplies since exports from the
Black Sea region account for about 30% of
global supply. While shipments from Russia
have continued, exports from Ukraine
have diminished to a trickle with the only
movement over land by truck or rail as
Russia blockaded ports weeks ago.
WHEAT MARKET REMAINS BULLISH
Fundamentally, nearly everything
" We're on the doorstep of
a food crisis. "
- Dan Basse, Ag Resource Group
looks bullish to the wheat market, the
analysts said.
The US Department of Agriculture in its
May 12 Crop Production report issued the
first survey-based winter wheat forecast for
the 2022 US crop. Winter wheat production
was forecast at 1,173,547,000 bus, down
103,818,000, or 8%, from 1,277,365,000 bus in
2021. The forecast was based on a harvested
area projected at 24,499,000 acres, down
965,000 acres, or 4%, from 25,464,000 acres
in 2021, and an average yield of 47.9 bus an
acre, down from 50.2 bus in 2021.
Perhaps the report's biggest surprise was
the 2022 hard red winter wheat production
forecast of 590,037,000 bus, down 21% from
749,489,000 bus in 2021, and well below the
average of analysts' pre-report expectations
at 685 million bus. If realized, the harvested
22
area in Texas would be the lowest on record.
" That kind of blew me away, " said Bill
Lapp, president and owner, Advanced
Economic Solutions. " I don't think the
USDA would make a bold prediction like
that unless they had tangible evidence to
support it. I wouldn't refute that number,
but it certainly stood out to me as a big hit
for the market. "
The reasons behind the overall lower
production figures were no mystery.
The USDA's appraisal of the May 17 US
Drought Monitor indicated 66% of US
winter wheat production was within
an area experiencing drought, the vast
majority of that area in hard red winter
wheat country. Hit hardest by a lack of
adequate moisture was wheat planted in
western Kansas, eastern Colorado and the
panhandles of Texas and Oklahoma. The
area where those four states meet was
entirely in extreme drought but had large
pockets in the driest category, exceptional
drought. US winter wheat abandonment
overall could reach its highest level since
2002, and perhaps the highest on record
in Texas and Oklahoma, the USDA said.
Scouts taking part in the Wheat Quality
Council's annual Hard Winter Wheat
Tour in mid-May found wheat in the
top-producing hard red winter state of
Kansas in a variety of conditions. A combination
of a warm, wet fall and a cold,
dry spring had wheat plants rising only
up to scouts' knees, but in many cases
already heading out. The state's central
and northern cropping districts mostly
featured lush, green stands of wheat with
kernels beginning to develop. As the
tour progressed west and south, wheat
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Milling & Baking News - May 31, 2022

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