U.S. wheat production and exports dropping

U.S. wheat acreage and exports are dropping and Russia and the Ukraine are taking up the slack, according to a recent USDA report.

USDA is forecasting that for 2002-03, the United States will again lead wheat exports by a huge margin, exporting about 25 million metric tons this year. The European Union is forecast to come in second, about 10 million tons behind the United States. But EU will also likely be the world's top wheat importer and will have net exports of just 5.5 million metric tons.

Russia and Ukraine will come in with about 9.5 million metric tons and 9 million metric tons, respectively, with Argentina taking fifth place with 8.3 million metric tons. Following these five leaders are Canada, Australia and India, with export forecasts of 8 million metric tons, 7 million metric tons and 5 million metric tons, respectively.

According to U.S. Wheat Associates, marketshare by the five traditional exporters (United States, Australia, Canada, EU and Argentina) has fallen from 84 percent to 63 percent in just three years.

The major reason is a 40-million-metric-ton decline in wheat production since 1999-2000 by the five traditional exporters, an 18 percent decline. Meanwhile non-traditional exporting countries have increased production. Russia is expected to bump its wheat production from 34.45 million metric tons in 2000-01 to a projected 49.5 million metric tons in 2002-03, while Ukraine has gone from 10.2 million metric tons in 2000-01 to 21 million metric tons projected for 2002-03.

Projected U.S. wheat production decreased 30 percent from 1999-2000 to 2002-03, with a resulting 15 percent decrease in exports as ending stocks dropped a precipitous 56 percent.

“While witnessing increased wheat production in many parts of the world, we have limited our own potential to compete, as farmers took wheat out of production for conservation programs and farm programs that encouraged the production of other crops,” said Paul Dickerson, vice president of U.S. Wheat Associates.

“Sadly, we pursued policies that reduced our own wheat production while other parts of the world were doing the opposite.

“Black Sea suppliers are here to stay,” Dickerson predicts. To compete, “U.S. producers will need to increase production, which should occur as a result of price incentives,” since more of America's high-quality wheat is needed in the world wheat market.

Overall, U.S. farmers seeded a little over 44 million acres of winter wheat for 2003, an increase of 6 percent over the previous year.

Meanwhile winter wheat seeding in the Mid-South dropped 340,000 acres, from 1.91 million acres in 2002 to 1.57 million acres in 2003, mostly due to prevented plantings due to late harvests of other crops. Most of the reduction in acreage comes from Arkansas, Mississippi and Louisiana. In 2001, wheat seeding in the Mid-South was 2.03 million acres.

e-mail: [email protected].

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