KSU Corn Market Outlook in July 2018: The July WASDE Impact on 2018-2019 Corn Price Prospects

An analysis of Corn Market Situation & Outlook in July 2018 for the remainder of the “old crop”  2017/18 and “new crop” 2018/19 marketing years is provided in the following article from Kansas State University .  This information follows the USDA World Agricultural Supply and Demand Estimates (WASDE) report on July 12, 2018.

A full version of this article is or will shortly be available on the KSU AgManager website http://www.agmanager.info/ at the following web address:

http://www.agmanager.info/grain-marketing/grain-market-outlook-newsletter

Following is a summary of the article on “Corn Market Situation & Outlook in July 2018″

**************

Corn Market Situation & Outlook in July 2018

In response to the July 12, 2018 USDA WASDE Report

Daniel O’Brien – Extension Agricultural Economist, Kansas State University

July 13, 2018

Intro

The July 12, 2018 USDA reports contained positive news for corn market prospects on balance.  Corn markets generally responded in a moderately positive-to-neutral manner to the July 2018 USDA World Agricultural Supply and Demand Estimates (WASDE) report – with important changes occurring and trends emerging in both domestic U.S. and foreign corn grain supply-demand and price prospects.

Projections of: 1) changes in corn usage in the U.S. corn “old crop” 2017/18 marketing year (MY); 2) higher 2018 production and total use estimates for U.S. “new crop” MY 2018/19; and 3) a sharp tightening of foreign corn supply-demand balances forecast for “new crop” MY 2018/19, were each key elements found in the July 12th WASDE report.

1) Higher Usage of U.S. Corn in “Old Crop” MY 2017/18 (ending August 31st)

The USDA increased its projection of U.S. corn usage and tightened its forecast of ending stocks in the “old crop” MY 2017/18 supply-demand balance sheet for U.S. corn.  Total “old crop” use of U.S. corn was projected to be up 70 million bushels (mb) from a month earlier to a record high 14.910 billion bushels (bb).  This was due to a combination of a 100 mb increase in projected exports (2.400 bb), a 25 mb increase in corn ethanol use (5.600 bb), a 20 mb drop in non-ethanol food, seed and industrial use (1.460 bb), and a 50 mb drop in forecast feed & residual use (5.450 bb). 

Projected exports were raised in response to the level of forward purchases of U.S. corn exports – being affected by a reduction in the 2018 Brazilian corn crop and exportable supplies.  Forecast U.S. corn ethanol use was increased to match the pace of U.S. ethanol production that has been occurring.  Conversely, U.S. corn feed usage was lowered following the rate of corn use reported in the June 29th USDA Grain Stocks report.  Ending stocks of 2.027 bb were down 25 mb from a month earlier, with a drop in percent ending stocks-to-use from 14.2% in the June WASDE to 13.6% in July, and mid-range price estimates being unchanged at $3.40 per bushel.

2) Higher Production & Usage with Tighter Stocks of U.S. Corn in “New Crop” MY 2018/19

The USDA raised its projection of 2018 U.S. corn production by 190 mb to 14.230 bb due to the increase in 2018 U.S. corn planted acreage (89.128 million acres or ‘ma’) and harvested acres (81.770 ma) reported in the June 29th USDA Acreage report.  Projected total supplies in “new crop” MY 2018/19 were raised by 115 mb to 16.307 bb due to a combination of reduced beginning stocks and higher production.

Total use of U.S. corn in “new crop” MY 2018/19 is projected to be up 140 mb than a month earlier, up to 14.755 bb – 2nd highest on record.  This was due to a combination of a 140 mb increase in projected exports (2.225 bb), a 50 mb decrease in corn ethanol use (5.625 bb – still a record high), a 10 mb drop from a month earlier in non-ethanol food, seed and industrial use (1.480 bb), and a 75 mb increase in forecast feed and residual use (5.425 bb).  Forecast ending stocks of 1.552 bb were down 25 mb from a month earlier, with a drop in percent ending stocks-to-use from 10.8% in the June WASDE to 10.5% in July, and midrange price estimates being down $0.10 from a month earlier at $3.80 per bushel.

3) South American Corn Trends Affecting World Stocks & U.S. Export Prospects

For “old crop” MY 2017/18 the USDA lowered its projections for Brazil of both production (down 1.5 million metric tons or ‘mmt’ to 83.5 mmt) and exports (down 3 mmt to 26.0 mmt) from a month earlier.  Forecast Argentina corn exports for “old crop” MY 2017/18 were also lowered from a month earlier, down 1 mmt to 24.0 mmt.  These reductions in South American exports were partially offset by a 2.54 mmt (100 mb) increase in forecast U.S. corn exports for “old crop” MY 2017/18. 

Sizable increases in World corn production are forecast from 1,033.74 mmt in “old crop” MY 2017/18 to 1,054.30 mmt in “new crop” MY 2018/19 (up 2.0%) – beginning on September 1, 2018.  These year-to-year production increases are more than matched by expected increases in total use, from 1,069.67 mmt in “old crop” MY 2017/18 to 1,094.08 mmt in “new crop” MY 2018/19 (up 2.3%).   As a result, ending stocks and % stocks-to-use of World corn are forecast to decline significantly, from 191.73 mmt in (17.9% Stks/Use) “old crop” MY 2017/18 to 151.96 mmt in (13.9% Stks/Use) in “new crop” MY 2018/19 (down 22.5%).   

Implications of the July 12, 2018 WASDE Report for U.S. Corn Market Outlook

The July 12th WASDE report spoke more to the demand and usage potential for U.S. corn in 2018-2019 than to supply prospects.  The first USDA survey-based information on the size of the 2018 U.S. corn crop will be provided in the August 10th USDA Crop Production report provided by the USDA National Agricultural Statistical Service (NASS).  These NASS results will be used in the August World Agricultural Supply and Demand Estimates (WASDE) report that same day for the purpose of estimating corn market supply-demand and prices going forward into “new crop” MY 2018/19 (to begin on September 1st).

The possibility still exists of 2018 U.S. corn production ending up being markedly lower than the 14.230 bb forecast in the July WASDE report.  Dry conditions in various areas – particularly Missouri and eastern Kansas, along with excessive moisture in the northern Iowa – southern Minnesota – eastern South Dakota area could cause lower yields, as could such issues as warmer than normal night time temperatures, etc. throughout the U.S. Corn Belt.  So, it is too soon to indicate without reasonable caution that 2018 U.S. corn crop prospects are reliably proceeding toward a 14.0-14.2 bb or more U.S. corn crop.  However, it IS likely at this time that the 2018 U.S. corn crop will not be “short”, and that total supplies of 16.25 to 16.75 bb will occur in “new crop” MY 2018/19 – being the 2nd highest on record after 16.937 bb which is now projected in “old crop” MY 2017/18. 

Key Issue – U.S. Corn Use Supported by Large Supplies & Low Corn Input Prices

A key issue driving in the U.S. corn market is the ongoing positive impact of low corn prices on U.S. corn usage.  Low prices due to abundant supplies nationally have provided support for U.S. corn domestic ethanol and wet corn milling use, and feed usage, as well as U.S. corn exports.  It is of no small significance that U.S. corn ending stocks are projected to drop from 2.027 bb (13.59% Stks/Use) in “old crop” MY 2017/18 down to 1.552 bb (10.52% Stks/Use) in “new crop” MY 2018/19. 

Following these changes in ending stocks, U.S. corn prices are projected to rise from a range midpoint estimate of $3.40 in the “old crop” period up to the range of $3.30-$4.30 /bu (midpoint = $3.80 /bu) in “new crop” MY 2018/19.  There is support for the idea that after harvest occurs there may be enough domestic and foreign demand for U.S. corn that the U.S. corn price could end up being closer to the higher end of the USDA forecast range (i.e., closer to $4.30 /bu) by summer 2019.   

Whether that occurs or not may depend on the development of production prospects for the 2019 South American corn crop during the January-June 2019 period.   It is widely thought that high soybean prices in South America that are occurring now in response to the U.S. – China trade dispute may cause larger than normal planted areas of soybeans to be planted in Argentina and Brazil in 2019 – essentially “crowding out” or “limiting” corn production in these same areas.  IF that occurs, then lower 2019 South American corn exportable supplies will provide support for U.S. corn exports in spring 2019.   And if any weather or production threats were to impact prospects for 2019 South American corn production, well, it would provide strong support for U.S. corn exports and prices in the first half of year 2019.

Final Thoughts re: U.S. Corn Market Outlook

It seems prudent to plan to manage both “old crop” and “new crop” corn marketings in years 2018-2019 with the idea that there will be adequate U.S. corn supplies and no major short crop event occurring.  This leads to adoption of the attitude that a somewhat “normal” seasonal price pattern for corn is likely for the remainder of “old crop” MY 2017/18 and especially for “new crop” MY 2018/19.  This would result is some price volatility being likely for the remainder of July-August 2018, but then as harvest approaches the probability of a seasonal harvest price low in September-November 2018. 

However, this year, from November 2018 through January 2019, the “narrative consensus” of the corn market will likely have a greater focus on corn planting progress and early season development in Argentina and Brazil – particularly in tandem with a focus on similar reports about the acreage and progress of their soybean crops.  It is possible if not likely that news about the pace of usage of U.S. domestic corn and other feedgrains will have the attention of the U.S. corn markets.  The impact of this news will be exacerbated IF U.S. corn exports are spurred on to higher levels by worries about potentially lower South American corn supplies for export in spring 2019.  Then from late winter into spring 2019 U.S. corn markets will be simultaneously paying attention to the pace of U.S. corn domestic and export usage and to 2019 U.S. corn planting prospects.  The corn market will likely then be driven by 2019 U.S. corn production prospects from what remains of spring through Summer and early fall 2019. 

During this anticipated “normal seasonal” price pattern for corn in “new crop” MY 2018/19, U.S. producers will be making marketing decisions under conditions of “uncertainty” as profitable seasonal pricing opportunities present themselves.  For those with a “risk averse” perspective on corn price risk management, there will be a tendency to price corn “earlier” and in “greater quantities” to avoid the possibility of being forced to sell at lower prices later on.  This “early action” approach contrasts to those of producers who are less worried (i.e., “averse”) about being in what is essentially a “speculative storage” position in the corn market – holding unpriced corn in storage longer while waiting for the possibility of a better price.    

The key point is that the likelihood exists of there being greater than normal price strength in U.S. corn markets through the winter and spring 2019 months – given the likelihood of more South American crop area being planted into soybeans to the exclusion of corn and the strong domestic demand base for the crop.

Image result

 

Advertisements

KSU Weekly Grain Market Review: Grain Market “Law of One Price” Will be At Play in U.S.-China Trade Dispute

Weekly Grain Market Review (KSU Ag Econ) for July 6, 2018

Question of the Hour in World Grain Markets:

How Will the “Law of One Price” Work Out for Grain Markets in the U.S.-China Trade Dispute?

By definition, “The law of one price is the economic theory that the price of a given security, commodity or asset has the same price when exchange rates are taken into consideration. The law of one price is another way of stating the concept of purchasing power parity. The law of one price exists due to arbitrage opportunities.” (Source: Investopedia, https://www.investopedia.com/terms/l/law-one-price.aspFeedback)

In regards to grain markets, here is more explanation:  “In case the two markets both produce and can trade a commodity in either direction the law of one price states that the price difference should be smaller or equal to transport and transaction costs.”

There are a number of studies in the grain markets within the last 10-20 years that appear to indicate that the Law of One price DOES hold in the grain markets in the long run, but that there may be short term (from several weeks to a month or so) during which prices may be “out of line” or “not aligned economically” in a manner that would otherwise be dictated by differences in transportation costs, exchange rates, or I would add, time, storage, or possibly even quality.

So, how do these definitions of the Law of One Price relate to the current situation in U.S., Chinese and World grain markets?  It seems that with 1) flexibility in the directional flow of grain, 2) the inflexible needs of domestic users of grain in terms of timing of usage and location of processing plants and/or livestock feeders, 3) the risks associated with point #2 and varying risk averse attitudes and approaches of domestic U.S. and foreign users, 4) the short term inflexibility of supplies coupled to the long term seasonal ability to adjust production plans, and other factors, that in the short term, grain markets may tend to be reactive, if not possibly over reactive to such an issue as tariffs on grain imports placed on U.S. soybeans, grain sorghum and other commodities by China.

However, past the initial reactions of the markets – to a degree rationally driven by short term needs of grain users, but to another degree perhaps driven by fear of the unknown in a risk averse environment, if not a herd mentality – there will be volatility in the grain markets.  In other words, it could be a challenge to figure out to what degree grain price volatility in the midst of a major trade dispute such as this between China and the U.S. should rationally affect grain prices.

There is a fair amount of confidence that grain markets will eventually readjust to changes in the directional flow of grain in international trade, and that livestock that has to be fed and processing plants that have to run will eventually receive their supplies.  But the period of adjustment could “try the mettle” and “test the courage, patience, and managerial ability” of both producers and users of grain, both in the U.S. and in China.

Finally, the reverberations from this event will likely persist and force themselves upon the grain markets over the next 1-2 years at least, as high soybean prices for export in South America may pull more Brazilian and Argentine acres into production for export to China, competing for corn acres in those countries, and affecting the decisions of U.S. corn producers in 2019.  And these speculations on future cropping patterns in response to the current U.S. – China trade dispute are only beginning.

Likely this trade dispute will eventually be settled – possibly by fall 2018 as China will need U.S. soybean supplies after South American supplies have run short.  If the trade dispute is settled by the U.S. 2018 soybean harvest, then the U.S. will likely ship soybeans to China directly.  If it is NOT settled by that time, then China will still need soybeans, but some form of trans shipments or substitution of inventories on an in and out basis via other countries may occur.  These and other questions will likely “roil up” the grain markets for months to come.

********

Grain market summary notes, charts and comments supporting the Weekly Grain Market Review presented in the KSU Agriculture Today radio program to be played on Friday, July 6, 2018 are available on the Kansas State University www.AgManager.info website at the following KSU web address:

http://www.agmanager.info/grain-marketing/grain-market-outlook-newsletter

The recorded radio program will be aired at 10:03 a.m. central time, Friday, July 6, 2018 on the K-State Radio Network (KSU Agriculture Today Radio) – web player available. A copy of the July 6th recording will be available afterwards at the KSU Agriculture Today website.

Following are sections of the Working notes for this week’s radio program up on the KSU AgManager.info website…

Weekly Grain Market Review (KSU AgEcon): Kansas Cash Corn and Wheat Basis Retains Strength Signalling Underlying Demand

Although Corn and HRW futures have declined sharply in the last few weeks, basis levels for corn and wheat at various Kansas locations have retained their strength – signaling underlying demand.

On the days ahead of the June 29, 2018 USDA Grain Stocks and Acreage reports U.S. grain markets have been “weak“.  CME JULY 2018 corn futures closed at $3.45 on Thursday, June 28th – trading in a range of $3.38 3/4 to $3.59 3/4 since June 18th.  CME JULY 2018 Hard Red Winter Wheat futures closed at $4.53 1/4 on Thursday, June 28th – at the very bottom of the trading range of $4.53 1/4 to $5.00 1/2 since June 19th.  Similarly, CME JULY 2018 soybean futures closed at $8.61 1/4 on Thursday, June 28th – trading in a range of $8.77 to $9.05 1/2 since June 18th.

Although the futures markets have been declining, cash basis levels for corn and HRW wheat in Kansas have displayed a large amount of variability across the state.  Corn basis levels in several Southwest Kansas locations are $0.03 to $0.10 under SEPT 2018 Corn futures – a positive event considering the weakness in futures prices.  Corn basis levels in Northwest Kansas are still $0.36-$0.40 under JULY 2018.  Overall, western Kansas cash prices range widely in June 28th, from highs near $3.49-$3.51 per bushel in Southwest Kansas to lows in the $3.05-$3.09 range in Northwest Kansas.

Central Kansas corn prices ranged from $3.10 to $3.28 per bushel, with basis levels being $0.17 to $0.35 under JULY 2018 Corn.  Conversely, Eastern Kansas corn basis was relatively strong, with cash prices of $3.45-$3.50 at major terminals in Topeka and Atchison, with basis being even with or $0.05 over JULY 2018 Corn futures.

Ethanol plant cash bids for corn in Kansas early in the day on June 28th were $3.52 1/2 to $3.82 1/2 on June 28th, with basis ranging from even with to $0.30 over JULY 2018 Corn futures.

Summary Thoughts on Kansas Corn Basis: The upshot of all this for corn, is that in locations near demand centers in Kansas (i.e., cattle feeding in southwest Kansas, processors in northeast Kansas, and ethanol plants throughout the state), cash corn basis levels are holding up well in spite of the recent declines in CME corn futures prices.  This is a positive market indicator of underlying demand for corn in this western Corn Belt state.

Wheat basis bids in Kansas have been strong – moving to the positive side ABOVE JULY 2018 and/or SEPT 2018 CME Kansas HRW wheat futures contract price in most central Kansas terminal locations, and strengthening from recent levels in western KansasCentral Kansas cash wheat bids ranged from $4.59 to $4.78 1/4 on June 28th, with basis ranging from $0.01 over to $0.25 over CME JULY 2018 Kansas HRW Wheat futures.   Eastern Kansas terminal bids in Topeka and Atchison were in the range of $4.43 1/4 to $4.53 1/4, with basis of $0.10 per bushel under to even with JULY 2018 futures.  Western Kansas wheat cash bids were in the range of $4.23 to $4.48 per bushel on June 28th, with basis of $0.30 to $0.25 per bushel under SEPT 2018 Kansas HRW Wheat futures.  These basis levels in western Kansas are stronger than had existed coming through the winter months of late 2017-early 2018.

Summary Thoughts on Kansas Wheat Basis: It seems that the cause of strength in Kansas wheat basis numbers depends on both prospects for a smaller 2018 Kansas and U.S. hard red winter wheat crop, and market demand for higher protein levels.

*******

Grain market summary notes, charts and comments supporting the Grain Market Update presented in the KSU Agriculture Today radio program that played on Friday, June 29, 2018 are available on the Kansas State University www.AgManager.info website at the following KSU web address:

http://www.agmanager.info/grain-marketing/grain-market-outlook-newsletter

The recorded radio program will be aired at 10:03 a.m. central time, Friday, June 29, 2018 on the K-State Radio Network (KSU Agriculture Today Radio) – web player available. A copy of the June 29th  recording will be available at the KSU Agriculture Today website.

Following are sections of the Working notes for this week’s radio program up on the KSU AgManager.info website…

 

Corn Market Prospects in Late-June 2018: Lower Prices – But Still Weighing “Likely vs Possible” S-D Outcomes

An analysis of U.S. & World Corn supply-demand factors and price prospects through the “new crop” 2018/19 marketing year from Kansas State University is provided in the following article summary.  This information follows the USDA World Agricultural Supply and Demand Estimates (WASDE) reports on June 12, 2018 with adjustments for alternative outcomes as identified by Kansas State University Extension Agricultural Economist Daniel O’Brien.

A full version of this article is available on the KSU AgManager website http://www.agmanager.info/ at the following web address:

http://agmanager.info/grain-marketing/grain-market-outlook-newsletter

Following is a summary of the article on “Corn Market Outlook in Late-June 2018″

**************

Corn Market Outlook in Late-June 2018

Daniel O’Brien – Extension Agricultural Economist, K-State Research and Extension

June 23, 2018

1. CME Corn Futures & Kansas Cash Corn Prices & Basis Bids

Since the release of the USDA’s June 12th World Agricultural Supply and Demand (WASDE) report, “old crop JULY 2018 CME corn futures prices have traded sharply lower.  On June 12th, the day of the report, JULY 2018 corn actually closed higher – up $0.10 ¼ to $3.77 ½ per bushel.  However, since then JULY 2018 corn futures have traded as low as $3.38 ¾ on June 19th before closing at $3.57 ¼ /bu on June 22nd (Figure 1).   “New crop DECEMBER 2018 CME corn futures prices also closed higher on June 12th – up $0.10 to $3.98 ¼ per bushel.  Then – just as for the JULY 2018 contract, DEC 2018 corn futures declined as low as $3.75 ½ on June 19th before closing at $3.78 /bu on June 22nd.   

The key point is that on May 24th prices for both of these contracts had traded approximately $0.50 /bu higher than their lows on January 12th of $3.62 /bu for JULY 2018 and $3.79 ¾ for DEC 2018 corn futures following the January 2018 USDA Annual Crop Production Summary, WASDE, and Grain Stocks reports.  But since then prices for both of these futures contracts have since fallen below those January 12th levels, effectively negating any “old crop” and “new crop” corn futures price gains that had occurred.        

In Western Kansas on Friday, June 22nd cash corn bids at major grain elevators ranged from $3.17 ($0.40 per bushel under JULY 2018 futures) to $3.52 ($0.05 under), and ranged from $3.22 ¼ ($0.35 under) to $3.40 ¼ ($0.17 under) in Central Kansas.  These prices are still higher than when corn bids statewide had fallen to $2.66-$2.96 /bu on December 23, 2016, and above marketing loan rates near $2.05 in Central Kansas and $2.19 per bushel in Western Kansas

Cash corn price bids in East Central and Northeast Kansas at major terminal locations were $3.52 – $3.57 /bu on June 22nd, with basis bids being $0.05 under to even with JULY 2018 corn futures.  These cash corn prices are still up from the range of $3.26-$3.28 per bushel on 12/23/2016.  Cash corn bids at Kansas ethanol plants on June 22nd ranged from $3.52 /bu ($0.05 under JULY) to $3.87 ($0.30 over JULY) – continuing to indicate strength in ethanol demand for corn in Kansas and nationwide.

*****

2. Overview of U.S. Corn Supply-Demand Prospects in Late-June 2018

The outlook and prospects for U.S. corn market prices through Summer-Fall 2018 of this year has declined from the end of May through June 22nd.   The outlook for U.S. corn prices is a “mixed bag” of factors that will likely have a combination of negative, positive, and as yet unknown impacts on corn prices in the “new crop” 2018/19 marketing year beginning on September 1, 2018.  The corn market is weighing the following factors in assessing current and future supply-demand and price prospects (Table 1).

First, U.S. corn planted acres are projected to be 88.026 million acres (ma) in 2018, down 2.141 ma from year 2017, and down 5.978 ma from year 2016 – with similar reductions in harvest acres (Table 1, Figure 4).  This reduction in acres continues to be a positive factor in support of corn price prospects for “new crop” MY 2018/19.  Lower U.S. corn acreage in 2018 has decreased the potential for total 2018 corn production, and provided support for “new crop” 2018/19 marketing year (MY) U.S. corn price prospects.   

Second, working contrary to the decrease in 2018 U.S. corn acres, strong U.S. corn planting progress in May and as of yet limited threats to 2018 U.S. corn yields in the U.S. have decreased risk and moderately increased 2018 U.S. corn production prospects from just a month ago in the view of the corn market – although the USDA has not changed its 2018 production forecast over that time period (Table 1, Figures 5-6).  In its June 12th WASDE report, the USDA projected 2018 U.S. corn yields to be 174.0 bu/ac, and 2018 U.S. corn production to be 14.040 billion bushels (bb) – both unchanged from a month earlier. 

Still, near record 2018 corn yields of 176.0 bu/ac would raise 2018 U.S. corn production to 14.229 bb – still down from both 14.604 bb in 2017 and the record high of 15.148 bb in 2016.  With beginning stocks of 2.102 bb and imports of 50 million bushels (mb), total supplies of U.S. corn in “new crop” MY 2018/19 are forecast to be 16.192 bb, down from record highs of 16.942 bb both of the previous two marketing years, but still the 3rd highest on record (Table 1, Figure 6)

Third, recent historic strength in U.S. total corn usage is expected to continue without interruption into “new crop” MY 2018/19.  Projections are for U.S. corn total use to be 14.615 bb in “new crop” MY 2018/19, down from the record high of 14.840 bb in “old crop” MY 2017/18, and from 14.649 bb in MY 2016/17 (Table 1, Figure 7 & 9)

By category, U.S. ethanol production and corn-ethanol usage continues to grow with support from a strong U.S. economy, associated gasoline demand, and the ongoing ethanol fuel usage requirements of the U.S. Renewable Fuels Standard (Table 1, Figures 8a-b-c).  United States’ corn usage for ethanol production is projected at arecord high 5.675 bb in “new crop” MY 2018/19, up from 5.575 bb a year ago, and 5.432 bb two years ago.  Non-ethanol Food, Seed and Industrial usage is projected to be record high 1.490 bb – up from 1.465 bb and 1.451 bb the previous two (2) marketing years (Table 1, Figure 7).  

Exports of U.S. corn are projected to be 2.100 bb in “new crop” MY 2018/19 – down from the 11-year high (Table 1, Figures 7 & 10) of 2.300 bb in “old crop” MY 2017/18, and 2.293 bb in MY 2016/17 .  During the eight (8) previous years, U.S. corn exports averaged 1.702 bb – ranging from 730 mb to 1.979 bb.  This “new plateau” in the exports for My 2016/17 through projected “new crop” MY 2018/19 illustrates the recent strength of U.S. corn exports and their contribution to U.S. corn usage.  Improved U.S. corn export prospects are expected partly as a result of 2018 corn production problems for export competitors Argentina and Brazil. 

United States’ corn feed and residual use is projected to be 5.350 bb in “new crop” MY 2018/19 as a result of anticipated high levels of overall U.S. livestock production in the remainder of 2018 and 2019, as well as expectations on only moderate strength in U.S. corn prices (Table 1, Figures 7 & 9).  This feed use amount of 5.350 bb in “new crop” MY 2018/19 would be down from the 11-year high of 5.500 bb in “old crop” MY 2017/18, and down from 5.472 bb in MY 2016/17, but up from an average of 4.902 bb the previous 8 marketing years.

Fourth, expectations are that U.S. corn ending stocks in “new crop” MY 2018/19 will decline considerably from a year earlier – down to 1.577 bb, and that percent (%) ending stocks-to-use will drop to 10.79% as a result of moderately tighter total U.S. corn supplies and continued strong total U.S. corn use (Table 1, Figures 11-12).  These figures compare to 2.102 bb ending stocks and 14.16% stocks/use in “old crop” MY 2017/18, and to 2.293 bb ending stocks and 15.65% stocks/use in MY 2016/17. 

Fifth, from late June through Fall 2018 the path of U.S. corn prices will be largely driven by the prospects for the 2018 U.S. corn crop – particularly as crop size information becomes available in the August, September and November USDA National Agricultural Statistics Service (NASS) reports on U.S. Crop Production.   The USDA projects that in “new crop” MY 2018/19 U.S. corn prices will range from $3.40-$4.40 per bushel – with a midpoint forecast of $3.90 per bushel (/bu) (Table 1a).  If U.S. corn prices were to average $3.90 in “new crop” MY 2018/19, it would be the highest price in five (5) years since $4.46 /bu in MY 2013/14 – the year of recovery following the catastrophic U.S. Corn Belt drought of MY 2012/13 when U.S. corn prices averaged a record high $6.89 /bu.  Expected higher U.S. corn prices in “new crop” MY 2018/19 is evidence of the impact of lower 2018 U.S. corn acreage and prospects for strong usage. 

The U.S. corn supply-demand and price scenario presented by the USDA in the June 12, 2018 World Agricultural Supply and Demand Estimates (WASDE) report is given a 50% likelihood of occurring by KSU Extension Agricultural Economist Kansas State University (Table 1a).

Sixth, when considering alternative outcome scenarios from the USDA’s June 12th forecast, IF for whatever reason during July-August 2018 there were a 200-500+ mb reduction in 2018 U.S. corn production prospects down to 13.500-13.900 bb, THEN projected U.S. corn ending stocks in “new crop” MY 2018/10 would likely decline to 1.250-1.400 bb with some price rationing of usage (Table 1a).   In this situation, percent (%) ending stocks-to-use likely fall below 10% stocks/use, with U.S. corn prices moving above $4.00 toward $4.35-$4.50 per bushel.  This point is further discussed in Section 3 that follows, where alternative scenarios and outcomes for U.S. corn supply-demand and prices are presented for “new crop” MY 2018/19.

*****

3. Alternative KSU Supply-Demand & Price Forecast for “New Crop” MY 2018/19

Three alternative KSU-Scenarios to the USDA’s forecast for U.S. corn supply-demand and prices are presented in what follows for “new crop” MY 2018/19 (Table 1a).  These projections show how varying 2018 U.S. corn production and export / total use scenarios could affect U.S. corn supply-demand and price outcomes in “new crop” MY 2018/19.  Probability-weights are added to reflect judgements about how likely each scenario is to occur in “new crop” MY 2018/19, i.e., during the September 1, 2018 through August 31, 2019 time period.

A – KSU “Higher 2018 U.S. Corn Production” Scenario for “new crop” MY 2018/19: (25% probability): Assumptions are as follows: 88.026 ma planted, 80.846 ma harvested, 176.0 bu/ac record yield (near the 2017 record high), 14.229 bb production, 16.381 bb total supplies, 14.666 bb total use, 1.715 bb ending stocks, 11.69% S/U, & $3.75 /bu U.S. corn average price; 

B – KSU “Lower 2018 U.S. Corn Production” Scenario for “new crop” MY 2018/19: (15% probability): Assumptions are as follows: 88.026 ma planted, 80.846 ma harvested, 165.0 bu/ac yield (near the 2009 low yield), 13.340 bb production, 15.492 bb total supplies, 14.205 bb total use, 1.287 bb ending stocks, 9.06% S/U, & $4.35 /bu U.S. corn average price.

C – KSU “Higher 2018 U.S. Corn Exports” Scenario for “new crop” MY 2018/19: (15% probability): Assumptions are as follows: 88.026 ma planted, 80.846 ma harvested, 174.0 bu/ac yield (equal to USDA forecast yield), 14.040 bb production, 16.192 bb total supplies, 2.250 bb exports (up 250 mb from USDA), 14.865 bb total use, 1.327 bb ending stocks, 8.93% S/U, & $4.65 /bu U.S. corn average price.

*****

4. World Corn Supply-Demand – Both With & Without China

World Production:  World corn production of 1,052.4 million metric tons (mmt) is projected for “new crop” MY 2018/19, up 1.7% from 1,034.8 mmt in “old crop” MY 2017/18, but down 2.4% from the record high of 1,078.4 mmt in MY 2016/17 (Figures 13-14a, Table 2).  The “new crop” 2018/19 marketing year begins September 1, 2018 and continues through August 31, 2019.  Production in Argentina of 41.0 mmt in 2019 would be a “rebound” from the short crop of 33.0 mmt projected in 2018, and equal again to 41.0 mmt produced in 2017.  Similarly, production in Brazil of 96.0 mmt in 2019 would also be a “rebound” from the short crop of 85.0 mmt projected in 2018, but down from 98.5 mmt in 2017.  The 2018 corn harvests for Argentina and Brazil occur in the later half of “old crop” MY 2017/18, i.e., February through August 2018.

World Total Supplies: World corn total supplies of 1,245.1 mmt in “new crop” MY 2018/19 are forecast to be down moderately from 1,262.7 mmt in “old crop” MY 2017/18, but up from the record high of 1,288.4 mmt in MY 2016/17. 

World Exports: World corn exports of a 158.0 mmt are projected for “new crop” MY 2018/19, up 4.6% from 151.1 mmt in “old crop” MY 2017/18, but down 1% from the record high of 159.7 mmt in MY 2016/17 (Table 3).

World Ending Stocks (% Stocks/Use): Projected World corn ending stocks of 154.7 mmt (14.2% S/U) in “new crop” MY 2018/19 are down 19.7% from 192.7 mmt (18.0% S/U) in “old crop” MY 2017/18, down 32.1% from the record high 227.9 mmt (21.5% S/U) in MY 2016/17, and 210.0 mmt (21.2% S/U) in MY 2015/16 (Figure 13-14a, Tables 8-9).  Projected Foreign (Non-U.S.) corn ending stocks of 114.6 mmt (13.1% S/U) in “new crop” MY 2018/19, is down 16.5% from 139.3 mmt (16.5% S/U) in “old crop” MY 2017/18, and is down from 17.7% from 169.3 mmt (20.0% S/U) in MY 2016/17.  

World-Less-China Ending Stocks (% Stocks/Use): An alternative view of the World corn supply-demand is presented if Chinese corn usage and ending stocks are isolated from the World market (Figures 14b-c, Tables 7-9).  “World-Less-China” corn ending stocks are projected to be 94.19 mmt (11.2% S/U) in “new crop” MY 2018/19, down from 113.1 mmt (13.6% S/U) in “old crop” MY 2017/18, and down from 127.2 mmt (15.4% S/U) in MY 2016/17.  These figures show that World stocks-to-use of corn less China’s direct influence are projected to be 21% lower (i.e., 11.2% S/U for the “World-Less-China” versus 14.2% S/U for the “World” overall in “new crop” MY 2018/19). 

World versus China Ending Stocks: At the same time, these figures also show that Chinese ending stocks of corn as proportion of the World total are declining – down from 52.8% in MY 2015/16, to 44.2% in MY 2016/17, to 41.3% in “old crop” MY 2017/18, and now are projected to be 39.1% in “new crop” MY 2018/19 (Tables 2-9).  The deliberate actions in recent years taken by the Chinese government to reduce feedgrain stockpiles is impacting the relative amount of World total corn stocks they hold.  These actions may eventually increase Chinese import demand for U.S. feedgrains if and when China has a severe short crop situation and limited stockpiles available to meet domestic demand.

*****

KSU Weekly Grain Market Review: Strong HRW Wheat Basis, Country-Level Grain Exports, and Corn Belt Dry Areas Persist (via NASA-Grace)

Grain market summary notes, charts and comments supporting the Weekly Grain Market Review presented in the KSU Agriculture Today radio program to be played on Friday, June 22, 2018 are available on the Kansas State University www.AgManager.info website at the following KSU web address:

http://www.agmanager.info/sites/default/files/pdf/KSRN_GrainOutlook_06-22-18.pdf

The recorded radio program will be aired at 10:03 a.m. central time, Friday, June 2, 2018 on the K-State Radio Network (KSU Agriculture Today Radio) – web player available. A copy of the June 22nd recording will be available at the KSU Agriculture Today website.

Following are sections of the Working notes for this week’s radio program up on the KSU AgManager.info website…

KSU Weekly Grain Market Analysis: Falling Grain Markets on U.S.-China Trade Issues and U.S. Crop Prospects

Grain market summary notes, charts and comments supporting the Grain Market Update presented in the KSU Agriculture Today radio program to be played on Friday, June 15, 2018 are available on the Kansas State University www.AgManager.info website at the following KSU web address:

www.agmanager.info/sites/default/files/pdf/KSRN_GrainOutlook_06-15-18.pdf

The recorded radio program was aired at 10:03 a.m. central time, Friday, June 15, 2018 on the K-State Radio Network (KSU Agriculture Today Radio) – web player available. A copy of the June 15th recording will be available at the KSU Agriculture Today website.

Following are sections of the Working notes for this week’s radio program up on the KSU AgManager.info website…

KSU Wheat Market Outlook in Mid-June 2018: HRW Wheat Harvest Markets with Protein in Demand

An analysis of U.S. and World wheat supply-demand factors and 2018-2019 price prospects following the June 12 USDA Crop Production and World Agricultural Supply Demand Estimates (WASDE) reports, and the market actions that have followed those reports are available on the KSU AgManager website (http://www.agmanager.info/).

Following is a summary – with the full analysis-article for Wheat to be found at this web location:

http://www.agmanager.info/grain-marketing/grain-market-outlook-newsletter

***

Wheat Market Outlook in Mid-June 2018

Daniel O’Brien – Extension Agricultural Economist, K-State Research and Extension

June 14, 2018

A. Wheat Futures & Cash Market Trends Following the June 12th USDA Reports

Since the USDA’s June 12th Crop Production and World Agricultural Supply and Demand Estimates (WASDE) report, CME JULY 2018 Kansas Hard Red Winter (HRW) Wheat futures have traded first higher and then lower again.  These reports were released during a time of harvest price pressure, when 2018 hard red winter wheat harvest was over half done in Oklahoma and Texas, and beginning in Kansas.  On the day of the report (June 12, 2018), JULY 2018 Kansas HRW wheat futures opened at $5.34 ½ and traded as high as $5.55 ½ before closing higher to $5.53 ½ that day.  The following two days JULY 2018 HRW wheat futures trended lower, closing at $5.39 /bu on Wednesday, June 13th and $5.22 ¼ /bu on Thursday, June 14th (Figure 1).   

On June 14th – the 2nd day after the USDA reports – Kansas cash wheat price terminal quotes in central and eastern Kansas ranged from $5.02 ¼ to $5.42 ¼ per bushel – with basis ranging from $0.20 under to $0.20 over JULY 2018 futures (Figure 2).  These prices are up 41%-47% from the range of $3.42 ¼ to $3.83 ¼ /bu in late December 2017 in eastern and central Kansas – with basis at that time ranging from $0.80 under to $0.39 under nearby MARCH 2018 futures.   A terminal Hard White Wheat (HWW) bid was available in Wichita, Kansas for $5.37 ¼ /bu, with a basis of $0.15 /bu over JULY 2018 Kansas HRW wheat futures.

In western Kansas on June 14th with harvest well underway to the south, representative wheat elevator bids ranged from $4.72 to $5.07 /bu, with basis being from $0.50 under to $0.15 under JULY 2018 futures.  These recent wheat cash price levels are up 36%-39% from $3.47 to $3.64 /bu in late December 2018 in western Kansas – when local basis varied from $0.85 under to $0.58 under MARCH 2018 futures.  

Lower 2018 production, higher protein levels in drought-damaged parts of the central and southern plains states of Texas, Oklahoma and Kansas, and to some degree foreign wheat crop concerns in competitive export countries such as Ukraine, Russia, and Australia, are the key market influencing factors credited for the increase in Kansas HRW wheat futures and cash prices since December 2017.  With this prices strength, local wheat basis levels in Kansas that were “wide and weak” in December 2017 have strengthened by $0.59-$0.60 /bu in central Kansas, and by $0.35-$0.43 /bu in western Kansas as of June 14. 

 

B. Early Harvest HRW Wheat Yield & Protein Results

Harvest results to date have shown low yields but higher protein in Oklahoma and parts of southern Kansas.  The June 8th Harvest Report of the U.S. Wheat Associates (http://www.uswheat.org/harvest) stated:

“Yields continue to be variable with a current average estimated at under 25 bu/ac (1.7 tons/ha). Hot temperatures forecast for next week (i.e., June 11-15) should push maturity. The first 60 samples are in for analysis with averages from 17 samples originating in Oklahoma reported. Test weights with a few exceptions ran above 60 lb/bu (78.9 kg/hl), which is a bit of a surprise given the environmental conditions in the area. Protein averaged between 11% and 12% (12% moisture basis).”

A report via Reuters indicates the following (“U.S. Grain Buyers Grab for High-Protein Wheat, Boosting Cash Prices.”, Reuters – Julie Ingwerson, June 14, 2018): 

“Cash prices for hard red winter (HRW) wheat in the southern U.S. Plains are surging as buyers scramble to lock up supplies of high-protein wheat from what could be the second-smallest crop in decades, traders said. Amid a global shortage of high-protein wheat, commercial grain handlers need the new-crop grain to blend into their stocks to salvage the lower-quality wheat left in their bins from last year. …….”

“The firm cash market reflects buyers’ hunger for high-protein wheat after two consecutive low-protein harvests that averaged 11.5 percent or less. Flour millers and exporters largely spurned the 2016 and 2017 HRW wheat harvests, seeking alternate supplies from outside of Texas, Oklahoma and Kansas. ……. Early returns from the 2018 harvest have been encouraging. Protein levels in HRW wheat samples from Oklahoma and southern Kansas have averaged 13 percent, according to weekly data from Plains Grains Inc., a trade group that conducts a wheat quality survey, and the Kansas Wheat Commission.”

Consequently, the lower yields occurring during early harvest 2018 in these central and southern plains states are being partially offset income-wise by higher protein wheat.  On a net income per acre basis, farmers are still likely to be worse off financially, as the higher price received for higher protein content HRW wheat does not compensate enough for the lower yield to sell on a per acre basis.

 

C. Key World Wheat Supply-Demand Results in the June 12th USDA WASDE Report

For the “new crop” 2018/19 marketing year (MY) beginning on June 1, 2018, the USDA projected the following (Figures 13 through 15b, Tables 2 through 9):

World wheat total supplies in “new crop” MY 2018/19 would be a record high 1,017.1 million metric tons (mmt) accompanied by record high total use of 750.9 mmt – up 0.1% and 1.0%, respectively, from “old crop” MY 2017/18.  The USDA in essence projects that the recent “large supply – large use” situation that has persisted since the last “supply-demand” period in MY 2012/13 will continue (Figure 13).  Concerns about 2018-2019 wheat crop production prospects in the Black Sea Region, Australia, and the U.S. could bring lower production and supplies – possibly causing World wheat supply-demand balances to decline in upcoming WASDE reports.  However, if these World wheat production reductions do NOT occur, then the current World wheat oversupply and associated low price situation is likely to persist.  

CommentaryKSU: These aggregate World supply and use numbers do NOT bring light to the shortage of high protein wheat that exists in World markets, OR the sizable wheat stocks held by China that are isolated from the World wheat market.

World wheat exports will also be a new record high 187.3 mmt in the “new crop” 2018/19 marketing year – up from a 182.8 mmt in “old crop” MY 2017/18, the previous record high of 183.3 mmt in MY 2016/17, and from 172.8 mmt in MY 2015/16 (Figure 13, Table 3).  While World wheat exports are forecast to increase by 12.9% since MY 2013/14 (i.e., 1 year after the short crop year of MY 2012/13), United States’ wheat exports are projected to decline by 19.2% from 1.176 billion bushels to 950 million bushels (mb) in “new crop” MY 2018/19. 

CommentaryKSU: This lack of growth in U.S. exports relative to foreign export competitors raises questions about whether the U.S. should focus more on HRW wheat protein and quality characteristics to differentiate it’s exportable wheat product. Also, a strengthening in the U.S. dollar exchange rate relative to export competitors with weak currency exchange rates continues to be a negative factor limiting the competitive affordability of U.S. wheat exports in World markets.  

World wheat ending stocks are projected to be 266.2 mmt in “new crop” MY 2018/19 – the 2nd highest on record following the high of 272.4 mmt in “old crop” MY 2017/18 (Figure 13, Table 8).  World wheat ending stocks have been growing an average of 14.7 mmt per marketing year from the low of 177.9 mmt in MY 2012/13, out-pacing the annual growth in total use of 10.6 mmt per marketing year – leading to growth in ending stocks. 

World wheat percent ending stocks-to-use (S/U) are forecast to be 35.45% in “new crop” MY 2018/19 – the 2nd highest on record (Figures 14a-b, Table 9).  The record was 36.65% in “old crop” MY 2017/18.  World wheat % stocks-to-use consistently increased each year from 25.89% in the short crop MY 2012/13 to current levels of 36.65% S/U in “old crop” MY 2017/18, and the USDA projection of 35.45% in “new crop” MY 2018/19.

CommentaryKSU: These results provide evidence that pace of growth in World wheat supplies has been faster than growth in total use since MY 2012/13 – leading to the current World oversupply situation and lack of sales opportunities and weaker prices for wheat of average protein and quality characteristics.

D. World-Less-China” Wheat Supply-Demand & the “China Supply Isolation” Factor

The broader “large crop-over supply-low price” situation in the World wheat market may be “obscuring” some important underlying market issues – particularly in regards to the “masking” effect of Chinese wheat stocks on available World wheat supplies and stocks.  

Total supplies and % ending stocks-to-use of wheat in World markets is projected to grow to record levels – with World wheat ending stocks-to-use of 35.45% in “new crop” MY 2018/19 (Figures 13 thru 14b, Table 8).  However, from a World-Less-China perspective, forecast ending stocks-to-use of 20.2% would be the lowest level in 11 years (Table 9, Figures 15a-b)“World-Less-China” wheat ending stocks-to-use would be down sharply from 23.2% in “old crop” MY 2017/18, and from the range of 22.05% to 27.5% during the MY 2008/09 – MY 2017/18 period. 

IF this China supply isolation factor eventually leads to noticeably tighter available global supplies of purchasable wheat for buyers to gain access to in coming months, it could have a significant positive impact on U.S. and World wheat market prices in “new crop” MY 2018/19.  However, unless there is this change in the broader, overriding focus of the World wheat market AWAY FROM aggregate global supplies over TO available “World-Less-China supplies the attention of the World wheat market may not change in this direction.

 

E. U.S. Wheat Supply/Demand for “New Crop” MY 2018/19

The USDA released their wheat production, supply-demand and price projections for the U.S. for “new crop” MY 2017/18 in the June 12th Crop Production & WASDE reports (Tables 1a-b).   

U.S. wheat plantings are forecast to be 47.339 million acres (ma) in 2018, up from the record low of 46.012 ma in 2017, but down from 50.119 ma in 2016 (Table 1, Figure 5)Harvested acres are forecast at 38.9 ma in 2018 (82.3% harvested-to-planted), up from the record low of 37.586 ma (81.7% harvested-to-planted) in 2017, but down from 43.850 ma in 2016 (87.5% harvested-to-planted) (Table 1, Figure 5).   The 2018 U.S. average wheat yield is estimated at 46.9 bu/ac, up from 46.3 bu/ac in 2017, but down from the 2016 record high of 52.7 bu/acre (Table 1, Figure 6)

Wheat production in the U.S. in 2018 is forecast to be 1.827 billion bushels (bb), up from 1.741 bb in 2017, but down from 2.309 bb in 2016.  Projected “new crop” MY 2018/19 total supplies are forecast at 3.043 bb, down from 3.076 bb in “old crop” MY 2017/18, and down from 3.402 bb in MY 2016/17 (Table 1, Figure 7)

U.S. Wheat total use of 2.097 bb is forecast for “new crop” MY 2018/19, up from 1.996 bb in “old crop” MY 2017/18, and from 2.222 bb in MY 2016/17 (Table 1, Figure 8).  By usage category, U.S. wheat exports are projected to be 950 mb in “new crop” MY 2018/19, up from 900 mb in “old crop” MY 2017/18, while being down from 1.055 bb in MY 2016/17 (Table 1, Figures 9 & 10)

CommentaryKSU: U.S. wheat exports fell to 47 year lows of 778 mb and 864 mb in MY 2015/16 and MY 2014/15, respectively, to levels just marginally above those pre-“Russian Grain Deal” in 1972.  This is more evidence of the only marginally competitive position that U.S. wheat exports find themselves in among foreign export competitors I recent years. 

Food Use of U.S. wheat is projected to be 965 million bushels (mb) in “new crop” MY 2018/19, up marginally from 963 mb in “old crop” MY 2017/18, and trending higher from 943 mb in MY 2016/17 (Table 1, Figure 8).   Feed & Residual Use of U.S. wheat is projected to be 120 mb in “new crop” MY 2018/19, up from 70 mb in “old crop” MY 2017/18, and from 156 mb in MY 2016/17 (Table 1, Figure 8).  

CommentaryKSU: With the USDA’s forecast of tighter U.S. corn and total feedgrain supplies along with higher feedgrain prices, the USDA is anticipating that feeding wheat to livestock will become more economically viable. 

The USDA projected “new crop” MY 2018/19 ending stocks to be 946 mb (45.1% Stocks/Use), down from 1.080 bb in “old crop” MY 2017/18 (54.1% stocks/use), and 1.181 bb in MY 2016/17 (53.15% stocks/use) (Table 1, Figures 11 & 12).   

CommentaryKSU: The anticipation of markedly lower U.S. 2018 HRW wheat production is having the end effect on U.S. wheat supply-demand balances of dropping ending stocks below 1.00 bb and ending stocks-to-use below 50%. To move ending stocks and % stocks-to-use much lower, it may be necessary to sharply increase U.S. wheat exports and total usage.   

United States’ wheat prices are projected to average $5.10 /bu in “new crop” MY 2018/19, up from $4.75 /bu in “old crop” MY 2017/18, from $3.89 in MY 2016/17, and $4.89 /bu in MY 2015/16, but still down from $5.99 /bu in MY 2014/15 (Table 1, Figures 11 & 12)  It is estimated by KSU that these USDA projections for “new crop” MY 2018/19 have a 60% probability of occurring.

 

F. Three Alternative KSU U.S. Wheat S/D Forecast for “New Crop” MY 2018/19

To represent possible alternative outcomes from the USDA’s June 12th projection, three potential KSU-Scenarios for U.S. wheat supply-demand and prices are presented for “new crop” MY 2018/19 (Table 1a, Figure 11).    

KSU Scenario 1) “Lower Production” Scenario (25% probability):   This scenario assumes that there will be 47.339 ma planted, 80.6% harvested-to-planted, 38.155 ma harvested, 45.0 bu/ac average yield, 1.717 bb production, 2.932 bb total supplies, 950 mb exports, 120 mb feed & residual use, 2.097 bb total use, 835 mb ending stocks, 39.82% Stocks/Use, & $5.75 /bu U.S. wheat average price.

KSU Scenario 2) “Higher Exports” Scenario (15% probability):   This scenario assumes that there will be 47.339 ma planted, 80.6% harvested-to-planted, 38.155 ma harvested, 46.9 bu/ac average yield, 1.827 bb production, 3.043 bb total supplies, 1.125 bb exports, 120 mb feed & residual use, 2.272 bb total use, 771 mb ending stocks, 33.93% Stocks/Use, & $6.20 /bu U.S. wheat average price.

KSU Scenario 3) “Lower Production & Higher Exports” Scenario (5% probability):   This scenario assumes that there will be 47.339 ma planted, 80.6% harvested-to-planted, 38.155 ma harvested, 45.0 bu/ac average yield, 1.717 bb production, 2.932 bb total supplies, 1.125 bb exports, 120 mb feed & residual use, 2.272 bb total use, 660 mb ending stocks, 29.05% Stocks/Use, & $6.55 /bu U.S. wheat average price.