World Agricultural Supply and Demand Estimates
US Department of Agriculture
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NOTE: This report adopts U.S. area, yield, and production forecasts for winter wheat, durum, other spring wheat, barley, and oats released today by the National Agricultural Statistics Service (NASS). For other crops, area estimates reflect the June 30 NASS Acreage report, and methods used to project yield are noted on each table. Survey-based production forecasts reported by NASS will be adopted in the August 12 issue of this report.
WHEAT: U.S. wheat supplies for 2009/10 are raised this month as higher area and yields add 96 million bushels to forecast production. Feed and residual use is raised 10 million bushels with the larger crop and lower expected prices. Exports are projected 25 million bushels higher with smaller crops in major exporting countries expected to reduce supply competition, particularly for higher quality wheat.
The ending stocks projection is raised 59 million bushels as the higher production forecast more than offsets expected increases in use. The first 2009/10 by-class wheat supply and demand projections indicate larger supplies of hard red spring, white, and durum wheat. Despite higher carryin, lower production reduces supplies of hard red winter and soft red winter wheat from year-ago levels. The 2009/10 marketing-year average farm price is projected at $4.80 to $5.80 per bushel, down 10 cents on both ends of the range.
This month’s 2008/09 changes reflect the latest export data and June 1 stocks. Exports are increased 5 million bushels and ending stocks are reduced 2 million bushels. As a result, feed and residual use is lowered 3 million bushels, but remains the highest since 2000/01. The 2008/09 marketing-year average farm price is estimated at a record $6.78 per bushel, down slightly from last month’s projection.
Global wheat supplies for 2009/10 are projected lower this month as a 1.0-million-ton beginning stocks reduction more than offsets a 0.4-million-ton production increase. The decline in world beginning stocks mostly reflects higher 2008/09 exports for EU-27, Canada, and Russia. World exports for 2008/09 are raised 4.1 million tons to 136.4 million, 18.8 million higher than the previous record in 2007/08.
World wheat production for 2009/10 is raised as higher output by the United States and FSU-12 countries more than offset reductions for Argentina, Canada, and EU-27. Production is raised 1.0 million tons for Russia and 0.5 million tons each for Ukraine and Kazakhstan, all on higher indicated area. Production for Argentina is lowered 1.5 million tons reflecting continued dryness in central growing areas and reduced prospects for seeded area. Recent rains in the southeastern growing areas are expected to boost plantings there partly offsetting area losses farther north. Production for Canada is also reduced 1.5 million tons as extended dry cool conditions in western growing areas delayed germination and crop establishment, reducing both area and yield prospects. EU-27 production is lowered 1.3 million tons as poor crop conditions across southern and southeastern Europe reduce yield prospects for Italy and Romania. Yield prospects are also lowered for the United Kingdom and harvested area is lowered for Denmark.
Global wheat imports, exports, and consumption for 2009/10 are all projected slightly higher this month. World imports are raised 0.8 million tons mostly reflecting increases for Syria, Turkey, and Yemen. World exports are raised 0.8 million tons with reductions for Argentina and Canada more than offset by increases for Ukraine, the United States, Kazakhstan, and Russia. Global
consumption is raised 0.8 million tons with higher projected food use in a number of Middle Eastern and African countries more than offsetting lower expected feed use in Canada and Ukraine. Global ending stocks are projected 1.4 million tons lower mostly reflecting the reduction in 2008/09 carryout.
COARSE GRAINS: U.S. feed grain supplies for 2009/10 are projected higher this month with higher expected beginning stocks and production for corn. Corn production for 2009/10 is projected at 12.3 billion bushels, up 355 million from last month as higher estimated area from the June 30 Acreage report boosts production prospects. Corn supplies are projected at 14.1 million bushels, up 335 million bushels from 2008/09. Feed and residual use for 2009/10 is raised 50 million bushels as increased supplies and lower prices are expected to boost feeding demand. Food, seed, and industrial use is lowered 35 million bushels reflecting lower expected use for sweeteners and starch. Exports are raised 50 million bushels as lower prices increase the competitiveness of U.S. supplies in the world market. Ending stocks are projected at 1.6 million bushels, up 460 million from last month, but down 220 million from 2008/09. The 2009/10 marketing-year average farm price for corn is projected at $3.35 to $4.15 per bushel, down 55
cents on both ends of the range.
Ending stocks for 2008/09 are raised 170 million bushels as lower domestic use more than offsets an increase in expected exports. Food, seed, and industrial use is lowered 120 million bushels with reductions projected for use in ethanol, sweeteners, and starch. The decline in corn prices has boosted ethanol producer margins; however, reduced production of gasoline blends with ethanol in May and June, based on the most recent weekly data, indicate lower-than-expected ethanol corn use. Feed and residual use is lowered 100 million bushels as indicated by the June 1 stocks. Exports are raised 50 million bushels based on recent increases in shipments and the high level of outstanding sales for the 2008/09 marketing year. The marketing-year average price is projected at $3.95 to $4.15 per bushel, down 15 cents on both ends of the range reflecting sharply lower summer price prospects.
Global coarse grain supplies for 2009/10 are projected 13.0 million tons higher this month mostly reflecting higher corn beginning stocks and production in the United States. Global coarse grain beginning stocks are raised 4.2 million tons with a 5.3-million-ton increase for corn only partly offset by lower beginning stocks for barley, sorghum, and oats. Global coarse grain production is projected 8.9 million tons higher with the increase in U.S. corn production only partly offset by lower corn production in Russia; lower barley production in Canada, EU-27, and the United States; and lower oat production in EU-27. Higher mixed grain and rye production for the EU-27 and barley production for Russia and Ukraine also add to world coarse grain supplies.
World coarse grain imports and exports are both projected slightly higher for 2009/10. Increased U.S. and Ukraine corn exports are mostly offset by reductions for Russia and Brazil. Global corn feeding is raised 0.8 million tons with higher feeding in the United States partly offset by a reduction for Ukraine. Global corn ending stocks are projected at 139.2 million tons, up 13.7 million from last month.
RICE: U.S. total rice supplies for 2009/10 are projected at 253.7 million cwt, down 4 percent from last month owing to reductions in beginning stocks, imports, and production. U.S. rice production is projected at 211.0 million cwt, 4 percent below last month, but 4 percent above 2008/09. Estimated harvested area at 3.0 million acres reported in the June 30 Acreage report is 5 percent lower than last month, but 1 percent above 2008/09. Long-grain harvested area is lowered 11 percent, and combined medium- and short-grain harvested area is raised 18 percent. The average all rice yield for 2009/10 is projected at 7,033 pounds per acre, 1 percent above last month, and 3 percent above 2008/09. Long-grain rice production is projected at 151.0 million cwt, about 11 percent below last month; while, combined medium- and short-grain rice production is projected at 60.0 million cwt, nearly 18 percent above last month. Beginning stocks for 2009/10 are lowered nearly 7 percent to 21.7 million cwt, while imports are lowered
about 5 percent to 21.0 million cwt. The reduction in imports is all in the combined medium- and short-grain rice class.
Total rice use for 2009/10 is projected at 231.0 million cwt, up about 1 percent from last month owing entirely to an increase in the export projection. Exports for 2009/10 are projected at 99.0 million cwt, up 2 percent, and up 1 percent from revised 2008/09. Exports of combined medium- and short-grain rice are raised 13 percent to 26 million cwt, while exports of long-grain rice are lowered 1 percent to 73 million. The milled rice export projection is raised 5 percent, while rough rice exports are lowered 3 percent.
USDA estimated June 1 rice stocks at 56.5 million cwt (combined rough and milled stocks on a rough-equivalent basis) in the Rice Stocks report published on June 30. The higher-than-expected stocks implied lower domestic and residual use during the March to May period. Consequently, annual domestic and residual use in 2008/09 is lowered 2 percent to 132.5 million cwt. The export estimate for 2008/09 is raised 4 percent to 98.0 million cwt. The volume of exports through the end of June combined with expected export deliveries during July leads to the boost in the 2008/09 export forecast.
The 2009/10 season-average farm price range is raised $2.75 cents per cwt on each end to $13.25 to $14.25 per cwt compared to a revised $16.05 per cwt for 2008/09. Smaller domestic supplies along with stronger-than-expected global prices will lead to higher U.S. prices in 2009/10. The long-grain season-average farm price range for 2009/10 is increased $2.50 per cwt on each end to $12.00 to $13.00 per cwt compared to a revised $14.85 per cwt in 2008/09. The combined medium- and short-grain farm price range is increased $4.00 per cwt to $19.50 to $20.50 per cwt compared to a revised $21.50 per cwt in 2008/09.
Global 2009/10 rice supply and use are little changed from last month’s projections. World production is raised less than 1 percent from last month as small increases for China and Vietnam more than offset a reduction for the United States. Global exports are raised 0.5 million tons mostly due to an increase for Burma. U.S. exports are also increased slightly. The Philippine import projection is raised 650,000 tons to 2.4 million. Ending stocks are lowered less than 1 percent from last month to 94.5 million tons.
OILSEEDS: U.S. oilseed ending stocks for 2009/10 are projected at 8 million tons, up 1.1 million from last month. Higher soybean stocks account for most of the increase. Oilseed production is projected at 96.3 million tons, up 1.8 million tons, with increased soybean production accounting for most of the change. Soybean production is projected at 3.26 billion bushels, up 65 million due to increased harvested area. Harvested area estimated in the June 30 Acreage report is 1.5 million acres above the June projection. The soybean yield is projected at 42.6 bushels per acre, unchanged from last month. Increased exports and crush partly offset increased supplies, leaving projected 2009/10 ending stocks at 250 million bushels, up 40 million from last month.
Prices for soybeans and soybean products are all reduced this month. The U.S. season-average soybean price for 2009/10 is projected at $8.30 to $10.30 per bushel, down 70 cents on both ends of the range. Soybean meal prices are projected at $255 to $315 per short ton, down 20 dollars on both ends. Soybean oil prices are projected at 31 to 35 cents per pound, down 2 cents on both ends of the range.
Global oilseed production for 2009/10 is increased 2 million tons to a record 423.4 million tons. Foreign production is projected up 0.2 million tons to 327.1 million tons. Soybean production is projected at a record 243.7 million tons, up 2.1 million due mostly to higher production in the United States. Production is also raised for Canada based on higher harvested area reported by Statistics Canada. Increased sunflowerseed production for Ukraine and the United States is partly offset by a reduction for EU-27. Rapeseed production is increased for Canada as higher harvested area is only partly offset by reduced yields. Other changes include reduced rapeseed production for Ukraine and EU-27.
U.S. soybean exports for 2008/09 are projected at 1.26 billion bushels, up 10 million from last month reflecting continued strong shipments and sales. In addition, higher projections for soybean meal exports and domestic soybean meal use result in a 5-million bushel increase in soybean crush to 1.655 billion bushels. Despite the increase, domestic soybean meal use for 2008/09 is projected down 8 percent from 2007/08 due to reduced meat production and increased supplies of alternative protein sources. Increased soybean exports and crush are offset mainly by reduced residual use, leaving ending stocks for 2008/09 unchanged at 110 million bushels.
SUGAR: Projected 2009/10 U.S. sugar supply is decreased 100,000 short tons, raw value, from last month. Beginning stocks are lowered 100,000 tons. Changes in production are offsetting, with beet sugar increasing and cane sugar decreasing, based mainly on the June Acreage report and recent yield trends.
Estimated 2008/09 U.S. sugar supply is unchanged from last month, with offsetting changes in production and imports. Based on the pace to date and prospects remaining in the fiscal year, beet sugar production is lowered 110,000 short tons, raw value. Also, imports from Mexico are increased 150,000 tons while imports under the tariff rate quota are decreased 40,000 tons. Sugar use is increased 100,000 tons to reflect the refined portion of the increase in imports from Mexico.
LIVESTOCK, POULTRY, AND DAIRY: Total U.S. meat production for 2009 is reduced as lower beef output more than offsets higher pork and poultry production. The beef production forecast is reduced for 2009 due to lower expected feedlot placements and slightly lighter average carcass weights. The Cattle report, to be released on July 24, will provide an indication of breeding herd retention and the number of cattle outside feedlots. The pork production forecast is raised due to larger-than-expected second quarter slaughter and heavier carcass weights. However, lower June 1 inventories result in a small reduction in the second-half 2009 pork production forecast. The broiler production forecast is raised as second- and third-quarter output is expected to be slightly higher.
Meat production for 2010 is raised as higher pork and broiler production outweigh slightly lower beef production. The recent Quarterly Hogs and Pigs report indicated a slower-than-expected decline in farrowing intentions which, coupled with continued gains in pigs per litter, results in larger supplies of slaughter hogs in 2010. In addition, lower forecast feed prices compared with last month supports heavier hog carcass weights. Broiler production forecasts for 2010 are also raised as lower feed prices are expected to aid producer returns. Turkey and egg production forecasts are unchanged from last month.
Turkey export forecasts for 2009 and 2010 are reduced largely because of expected lower shipments to Mexico. Export forecasts of other meats are unchanged. The beef import forecast is raised fractionally for 2009 on stronger second-quarter shipments to date. Other import forecasts for 2009 and 2010 are unchanged from last month.
Price forecasts for 2009 are lowered for hogs, generally reflecting a higher production forecast. Cattle and broiler forecasts are unchanged. Egg prices in 2009 are forecast lower on softer demand. For 2010, higher forecast pork production is expected to weigh on supplies and price forecasts are reduced. Prices for cattle and broilers are unchanged. Egg price forecasts are reduced as the current market weakness is expected to carry into 2010.
The milk production forecast is raised fractionally for 2009 as the reduction in cow numbers is slightly slower than expected. Milk production for 2010 is unchanged. Imports for 2009 on a skim-solids basis are forecast lower; the commercial export forecast is unchanged from last month. Net removals are adjusted for both higher nonfat dry milk (NDM) sales to the CCC and product exports under the Dairy Export Incentive Program (DEIP). Cheese, butter, and NDM price forecasts are lowered as supplies are large but whey prices are forecast higher. For 2009 and 2010, Class III
prices are reduced as lower cheese price forecasts more than offset higher whey prices. The Class IV price forecast is reduced in line with lower butter and NDM prices in both 2009 and 2010. The all milk price is forecast at $11.85 to $12.15 per cwt for 2009 and $14.85 to $15.85 for 2010.
COTTON: The U.S. cotton supply and demand estimates for 2009/10 show lower beginning stocks offset by lower exports, leaving ending stocks unchanged from last month at 5.6 million bales. Planted area is raised marginally, consistent with the June 30 Acreage report; however, harvested area is unchanged, as the estimate of acres abandoned is raised to reflect conditions to date. Production is estimated at 13.25 million bales, the same as last month. Domestic mill use also is unchanged, but exports are reduced 600,000 bales to 10.2 million due to lower U.S. supplies and reduced foreign import demand. The forecast range of 48 to 60 cents per pound for the marketing-year average farm price is the same as last month.
A combination of higher beginning stocks and lower consumption are raising this month’s projected world 2009/10 cotton ending stocks by about 2 percent. Beginning stocks are raised about 800,000 bales, due to adjustments in the 2008/09 balance sheets for several countries. World production in 2009/10 is reduced marginally, due to reductions for Turkey and Uzbekistan. World consumption also is reduced, as consumption is forecast lower in Pakistan, China, and Thailand, but higher in India and Syria. World trade is lowered about 1.0 million bales, due to reduced import demand by China, Pakistan, and Thailand, partially offset by an increase for Turkey. Despite the increase in world stocks from last month, ending stocks are still forecast nearly 7 percent below the beginning level.
A number of adjustments have been made in the 2008/09 and earlier estimates. Consumption is reduced in Pakistan beginning in 2006/07 to more closely reflect official government data. Consumption in 2008/09 also is reduced in China and Thailand, but is raised in India and Turkey, to reflect recent data and analysis. Adjustments based on recent activity are made to the trade estimates for several countries, including an increase of 600,000 bales in U.S. exports. Ending stocks are raised in Pakistan, China, and Turkey, but are lowered in the United States, India, Brazil, and Uzbekistan.
Approved by the Secretary of Agriculture and the Chairperson of the World Agricultural Outlook Board, Gerald A. Bange, (202) 720-6030. This report was prepared by the Interagency Commodity Estimates Committees.
JAMES W. MILLER
ACTING SECRETARY OF AGRICULTURE
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