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US Wheat Associates road trip 2015

by Roger Gilbert, Milling and Grain Magazine, Publisher

ix classes of US wheat is planted and

harvested in almost every month of the
year and is recognised as being one of
the most reliable globally which can fit
precisely to almost every end-use product.
In early November, the US Wheat
Associates, which helps to develop markets
for US wheat and is working in over 80
countries undertook its annual road trip
around Europe to explain the current years crop outcome in
detail for buyers and users.
Rutger Koekoek, US Wheats marketing specialist based in The
Netherlands, summarised the World Wheat Supply and Demand
Situation for 2015-16 by identifying global production would
reach 733 million tonnes, up eight million tonnes on the previous
year with major exporter supplies being up by 11 million tonnes:
with major exporter ending stocks increasing by five million
tonnes and US ending stock in particular being the largest since
2009-10 at 23.4 million tonnes or 17 percent above their fiveyear average of 20 million tonnes.
He also recorded the world consumption is set to post a new
record. While the trade itself will see a decrease from 2014-15
levels, based on consumption in South East Asia expected to
increase, and world feed use up by some five million tonnes.
The US farm gate average price is to decline, he projected
and suggested an average price of between US$175-193 per
tonne.
The average farm gate price in 2014-15 was US$220 and $252
per tonnes in 2013-14.
The global crop outlook will be impacted by: El Nino; the
lingering drought in Australia which has reduced yield potential;
floods in Argentina resulting
in lost wheat area and despite
moisture conditions in the US
for HRW and SRW improving
due to recent rains the US SW
crop remains dry.
Finally, lower winter wheat
area in the Ukraine and poor
early crop establishment with
increased risk of winterkill
have to be considered
alongside improved recent
rains in southern Russia that
will impact its winter wheat
crop, he adds.
He told invited delegates
that production from the
top exporting countries for
2015-16 would be up by

40 | December 2015 - Milling and Grain

three million tonnes over 2014-15 at 377 million tonnes while

beginning stocks were significantly higher at 63 million tonnes
compared to 54 million tonnes in 2014-15, resulting in total
supplies being up by 11 million tonnes.
The forecasted change in world wheat production in 2015-16
shows a positive increase of seven million tonnes with RussianUkraine producing an additional seven million tonnes, China four
million tonnes and North America three million tonnes. These
increases are offset by declines in production in India of seven
million tonnes, Canada three million tonnes and Argentina two
million tonnes.
The forecasted change in world wheat exports in 2015-16
would be down by two percent at 161 million tonnes with
Canada down four million tonnes, India down three million
tonnes and the EU down two million tonnes. These declines
would be compensated for increased exports from RussiaUkraine by five million tonnes and a likely two million tonne
addition from Australia.
Finally, all major wheat importers are expected in increase their
demand: Egypt to 11.5 million tonnes; Indonesia to 7.8 million
tonnes; Algeria to 7.7 million tonnes; Brazil to 6.7 million tonnes;
EU to six million tonnes and Japan to 5.8 million tonnes.
In summary, world wheat production is up between five and
seven million tonnes, world wheat consumption up by nine
million tonnes and all this supported by a big supply of better
quality wheat than we had last year, says Mr Koekoek.
And this will leave world ending stocks for 2015-16 at a record
high of 228 million tonnes which is well above the 10-year
average of 177 million tonnes and having 72.6 million tonnes of
that buffer available to world markets, when the 10-year average
has been 66 million tonnes.
Global stocks-to-use ratio stands at 32 percent up from 30 percent
in 2014-15 and up on the 10-year average of 27 percent.