USDA raises wheat carryover above 1 billion bushels

by Jay Sjerven
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WASHINGTON, D.C., U.S. — The U.S. Department of Agriculture on Feb. 6 raised its forecast for the carryover of wheat on June 1, 2018, to 1.009 billion bushels. The new forecast was 20 million bushels higher than the January projection. A forecast decline of 25 million bushels for 2017-18 wheat exports from the January outlook more than offset a 5-million-bushel increase in the forecast for food use of wheat.

At 1.009 billion bushels, the revised carryover forecast was 172 million bushels shy of the 2017 carryover pegged at 1.181 billion bushels. The 2017 wheat carryover was the largest since 1988. The new forecast compared with the average of pre-report trade projections at 993 million bushels.

The USDA forecast for the 2017-18 wheat supply was unchanged at 3.076 billion bushels, which included a carry-in of 1.181 billion bushels, unchanged from January, production at 1.741 billion bushels, unchanged from the January estimate but down 25% from 2.309 billion bushels in 2017, and forecast imports at 155 million bushels, also unchanged from January but up 37 million bushels from 2016-17.

The USDA forecast food use of wheat in 2017-18 at 955 million bushels, up 5 million bushels from the January projection, up 6 million bushels from 2016-17 total but shy of the 957 million bushels in food use in 2015-16 and the record 958 million bushels in 2014-15. The USDA raised its food use forecast based on the National Agricultural Statistics Service Flour Milling Products report issued on Feb. 1, which indicated a higher-than-expected use in the first half of 2017-18.

“Additionally, implied flour extraction rates were lower in the second quarter, as compared with last year, and a continuation of this trend is expected to support increased wheat for food usage into the second half of 2017-18,” the USDA said.

Seed use of wheat in 2017-18 was forecast at 62 million bushels, unchanged from January and up 1 million bushels from 2016-17. Feed and residual use of wheat in 2017-18 was forecast at 100 million bushels, unchanged from January but down 56 million bushels from 2016-17.

The USDA forecast 2017-18 wheat exports at 950 million bushels, down 25 million bushels from January and down 10% from 1.055 billion bushels in 2016-17.

The USDA forecast the 2018 carryover of hard red winter wheat at 494 million bushels, up 10 million from the January projection. The hard red spring carryover was forecast at 176 million bushels, down 2 million bushels. The soft red winter wheat carryover was forecast at 228 million bushels, down 3 million bushels from January. The white wheat carryover was forecast at 76 million bushels, up 15 million bushels from January because of lower forecast exports. The durum carryover was forecast at 35 million bushels, unchanged from January.

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