USDA forecasts 2017 wheat production at 1.837 billion bushels


The U.S. Department of Agriculture forecast U.S. wheat production in 2017 at 1.837 billion bushels, down 473 million bushels, or 20%, from 2.310 billion bushels in 2016. The 2017 crop as forecast would be the smallest since 1.808 billion bushels in 2006. The decrease from 2016 resulted from expectations of both a smaller planted area and lower yields.

The wheat production forecast was part of the outlook for grain and oilseeds supply and demand for 2017-18 presented by Rachel Trego, agricultural economist with the USDA’s Foreign Agricultural Service, at the USDA’s 93rd annual Agricultural Outlook Forum on Feb. 24 in Washington, D.C., U.S.

The USDA forecast area planted to wheat for harvest this year at 46 million acres, down 4.2 million acres, or 8%, from 50.2 million acres in 2016. The forecast all-wheat area was the smallest in records extending back to 1919. The last time all-wheat acres fell below 50 million acres was 48.7 million acres in 1970.

The winter wheat planted area, as estimated in the Jan. 12, 2017, Winter Wheat and Canola Seedings report, was 32.4 million acres, down 3.8 million acres, or 10%, from 36.2 million acres in 2016. The winter wheat area was the smallest in 108 years. The decrease in winter wheat planted area mostly resulted from a 3.3-million-acre decline in hard red winter wheat area to 23.3 million acres. The soft red winter wheat area was estimated at 5.7 million acres, down 0.3 million acres from 2016. The white winter wheat planted area was estimated at 3.4 million acres, down 0.2 million acres from 2016.

The all-wheat planted area forecast suggested a forecast spring wheat (including durum) planted area at 13.6 million acres, down 3% from 14 million acres in 2016. It would be the smallest spring wheat planted area since 13 million acres in 2013.

The all-wheat harvested area in 2017 was forecast at 39 million acres, down 4.9 million acres, or 11%, from 43.9 million acres in 2016. The forecast 2017 harvested to planted was 84.8%, down three percentage points from 2016 and about on par with the five-year average.

The average all-wheat yield in 2017 was forecast at 47.1 bushels per acre compared with a record 52.6 bushels per acre in 2016. The USDA pointed out if the forecast is realized, the 2017 average yield would be equal to that of 2013 and would be slightly above the five-year average. The USDA observed, “Drought conditions in much of the Northwest and northern Plains have largely abated while sections of the hard red winter wheat belt in the central and southern Plains are experiencing dry conditions. In particular, areas of eastern Colorado, western Kansas and parts of Oklahoma are experiencing areas of moderate to severe drought.”

The USDA forecast all-wheat supply in 2017-18 at 3.096 billion bus, down 314 million bus, or 9%, from 3.410 billion bushels in 2016-17. The five-year average all-wheat supply was 3.050 billion bushels.

U.S. wheat imports in 2017-18 were forecast at 120 million bus, down 5 million bus from the forecast for the current year.

The USDA forecast domestic use of wheat in 2017-18 at 1.216 billion bushels, down 30 million bushels from the forecast for the current year. Food and seed use of wheat was forecast at 1.026 billion bushels, up 5 million bushels from 2016-17 with all of the increase tied to increased seed use. Feed and residual use of wheat in 2017-18 was forecast at 190 million bushels, down 35 million bushels from the forecast for 2016-17.

The USDA forecast 2017-18 U.S. wheat exports at 975 million bushels, down 50 million bushels from the forecast for the current year. The USDA commented, “Lower domestic supplies and tough international competition will limit U.S. exports. After setting records in four consecutive years, world wheat production in 2017-18 is expected to decline. In addition to the large reduction in the U.S. crop, wheat output in both Australia and Russia is expected to be significantly lower following record crops in the previous year. Smaller crops are also expected in Canada and Ukraine. Conversely, the European Union is well positioned to have a larger crop and plentiful exports after unfavorable weather conditions last year. Global wheat trade and food consumption are both anticipated to increase. Larger imports in the Middle East and Sub-Saharan Africa will be partly offset by reduced import demand in Morocco and Algeria. Additionally, robust import demand and consumption is expected to continue in Asia.”

The USDA forecast the carryover of wheat on June 1, 2018, at 905 million bushels, down 234 million bushels, or 21%, from a forecast 1.139 billion bushels in 2017.  The 2017 carryover was forecast to be the largest since 1.261 billion bushels in 1988.

The 2018 carryover as projected would be the smallest in three years but still would be above the five-year average of 835 million bushels.

The forecast ending stocks-to-use ratio for 2017-18 would be 41.3% compared with 50.2% as the ratio forecast for the current year. The ratio still would be above the five-year average. The 2017-18 season-average farm price of wheat was projected at $4.30 a bushel, up 45c from the midpoint of the range forecast for 2016-17. The USDA noted, “The prospect of lower 2017 hard red winter wheat acreage, as implied by the National Agricultural Statistics Service’s Winter Wheat and Canola Seeding report, and relatively tight supplies for hard red spring wheat are supportive for U.S. wheat prices.”


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