Record wheat production but consumption to match


The latest World Agricultural Supply and Demand Estimates (WASDE) were released last week by the United States Department of Agriculture (USDA). The WASDE sets the benchmark for the supply and demand of many commodities and always has the potential to move markets. This month was no different.

On the wheat front, the WASDE announcement led to some reasonably significant changes to the wheat supply.  Total wheat production was reduced from 800 million tonnes, back to 796mmt, which equates to a fall of 0.5%.  The WASDE also reduced wheat consumption, down 2mmt to 793mmt.  Figure 1 shows that both wheat production and consumption are still expected to be at record highs in 2023-24.

Wheat production in the US was increased by 2mmt, which was more than offset by decreases in major exporters, the EU, Canada and Argentina.  Interestingly, the USDA still have Australian wheat production pegged at 29mmt. 

The ABARES Crop Report has wheat at 26.2mmt.  A 3mmt decrease in world production would be enough to give the market a lift when the USDA comes into line with Australian estimates.

Soybean production took the biggest hit, losing 5mmt, but is still coming in well above last year at 405mmt.  As outlined over the last couple of weeks, US soybean acreage has taken a hit, with most of the decrease in world production being due to this. 

Other major exporters are all South American, and with the new season crop yet to go in the ground, there was no change in their expected production.

World rapeseed production was left largely unchanged.  There is plenty of speculation that the Canadian crop might be smaller than expected given the hot dry weather being experienced there this summer.

What does it mean?

There might be some more cuts to come in some of the USDA’s forecasts, however, there are plenty of unknowns, mainly in South America.  Markets have rallied post-WASDE, mainly in oilseeds which have been on a bullish trend.  Wheat has also found some strength, but this is more due to issues around Ukraine and Russia, rather than concerns with production.

Have any questions or comments?

We love to hear from you!

Print This Post

Key Points

  • The latest WASDE made some cuts to wheat and soybean production.
  • Markets found some support from the expected lower supplies.
  • There is still plenty of uncertainty surrounding world grain and oilseed supplies.

Click on figure to expand

Click on figure to expand

Data sources: USDA, Mecardo

Make decisions with confidence- ask about our board packs, bespoke forecasting and risk management services

Have any questions or comments?

We love to hear from you!
Grains & Oilseeds

Jack tours Russia

To start the week, the wheat market got a very nice little push courtesy of Russian frosts, a bullish USDA report and technical short covering.

Read More »
Wheat plants _ image
Grains & Oilseeds

Benign May WASDE

It’s May and the new season World Agricultural Supply and Demand Estimates (WASDE) from the United States Department of Agriculture (USDA) is out. The WASDE

Read More »
Grains & Oilseeds

Weather bingo card

After the relatively quiet last few months where the ag commodity markets have drift-ed lower, the establishment of the weather market has seen a welcome

Read More »

Want market insights delivered straight to your inbox?

Sign up to the mailing list to get regular updates to new analysis and market outlooks

Independent analysis and outlook for wool, livestock and grain markets delivered to you as it’s published

Commodity conversations podcast cover image, a illustration of a sheep standing on a cow's back with grain either side
Listen to the podcast

Join the Mecardo team for the Commodity Conversations podcast, where we provide short weekly market recaps and longer conversations with guests to discuss the drivers and trends in livestock, grain and fibre markets.

Photo of a farmer surrounded by Merino sheep in dusty yards
Research: Analysis of the Australian sheep flock

In this report for LiveCorp and MLA, we analysed the historical trends in the demographics of the Australian sheep flock, examining domestic factors that influence farm-level enterprise decision making. 

Image of harvested grain pouring into a chaser bin

We don’t just bring you the most up to date market insights. Find out more about Mecardo’s services including risk management advisory, modelling, benchmarking, research & consultancy.