USDA Raises Wheat Numbers in April WASDE Report

USDA on Tuesday released its April Crop Production and World Agricultural Supply and Demand Estimates (WASDE) reports.

In a report with few changes to U.S. corn and soybean numbers, USDA lowered Argentina’s corn production 3 million metric tons (mmt) to 37 mmt, but held pat on Brazil’s production, at 125 mmt, despite expectations that Brazil’s production is higher.

You can access the full reports here:

Crop Production: https://www.nass.usda.gov/…

World Agricultural Supply and Demand Estimates (WASDE): http://www.usda.gov/…

Associate Farm Editor Reagan Calk had the chance to visit with Allendale’s Rich Nelson about the findings in these reports.

There were not any major changes made in this report, Nelson said, because of the time of year between new crop and old crop numbers.

“Only real main issue as far as changes on the grain side, at least, was the wheat discussion,” Nelson said. “USDA did raise those numbers by 30 million bushels from the prior month- now 598 million bushels.”

As far as the discussion on the wheat side, Nelson said U.S. wheat prices have “divorced” themselves from U.S. supply and demand numbers.

“We are being driven right now in our pricing, by this balance sheet from the world basis,” Nelson said.

Regarding Oklahoma’s winter wheat crop, Nelson said USDA is still looking at some pretty low numbers.

“Only 20 percent good to excellent for this hard red crop in Oklahoma,” Nelson said. “That is not too far different from the entire winter wheat crop- only 27 percent good to excellent.”

WHEAT

USDA increased U.S. wheat ending stocks for the 2022-2023 season to 598 mb, exceeding analysts’ pre-report estimates of 581 mb. It is the lowest ending-stocks number in nine years.

Average wheat farm gate price was estimated at $8.90 per bushel, a drop from $9.00 last month.

Globally, old-crop wheat ending stocks were projected at 265.05 mmt down from 267.20 mmt in the March estimate.

In South America, USDA estimates Argentina’s ending stocks at 2.53 mmt. That’s a slight decrease from 2.51 mmt in March. Brazil’s ending stocks are estimated at 1.78 mmt, an increase from 1.08 mmt in March.

Ukrainian ending stocks are estimated at 3.34 mmt, a decrease from 4.17 mmt in the March estimates. Russian ending stocks are pegged at left unchanged at 14.39 mmt.

USDA estimates Ukraine’s exports at 14.50 mmt, an increase from 13.50 mmt in March. Russian exports are estimated at 45.0 mmt, an increase from 43.50 mmt in March.

SOYBEANS

USDA left soybean ending stocks for 2022-23 unchanged at 210 mb. Traders anticipated USDA would lower its estimate following last month’s Grain Stocks report. USDA made no changes to soybean’s demand categories, leaving exports at 2.015 bb and crush at 2.22 bb. The national average farm gate price was also unchanged at $14.30 per bushel.

Global ending stocks increased by .28 mmt to 100.29 mmt. USDA lowered global soybean production by 5.5 mmt, but also reduced its crush estimates, resulting in very little adjustment to the overall stocks figure. USDA increased its forecast for Brazilian soybean production by 1 mmt to 154 mmt, while slashing Argentina’s output to 27 mmt from 33 mmt.

LIVESTOCK

Tuesday’s WASDE report treated the beef and cattle markets mostly favorably. Beef production for 2023 was raised by 110 million pounds, with the second and third quarters of 2023 both seeing increases in beef production while the first and fourth quarters were decreased. The first quarter of 2023 saw a slight price decrease from last month’s report, down $0.10 to average $160.90, but the rest of the quarters for the year saw price increases. The second quarter of 2023 is expected to average $169.00 which is $6.00 higher from last month, the third quarter is expected to average $162.00, which is $3.00 higher from last month, and the fourth quarter is expected to average $167.00, which is $3.00 higher than last month. 2023 beef imports were raised by 75 million pounds, but exports for the year also grew by 45 million pounds as demand from Asia countries remains incredibly strong.

Mostly Tuesday’s WASDE report wasn’t the news that the pork and hog markets wanted to see. Pork production for 2023 was decreased by 50 million pounds as the latest Hogs and Pigs report highlighted that the December-February pig crop and producer farrowing intentions for March-May were lower than originally expected. The quarterly price projections for barrow and gilt prices were a bitter pill to swallow in Tuesday’s report as all four quarters saw price reductions from a month ago as the USDA accounted for the light/modest demand in which pork cuts have been receiving. The first quarter was reduced by $1.17 to average $54.83, the second quarter fell $10 from last month to average $60.00, the third quarter fell by $6.00 to average $67.00 and the fourth quarter fell by $2.00 to average $62.00. Pork imports for 2023 grew by 60 million pounds from last month, but pork exports also grew by 30 million pounds.