WASHINGTON – The US Department of Agriculture on May 12, in its initial wheat supply-and-demand forecasts for 2021-22 as presented in the May World Agricultural Supply and Demand Estimates report, projected the carryover of wheat on June 1, 2022, at 774 million bus, down 98 million bus, or 11%, from an upwardly revised 872 million bus forecast for 2021 and compared with 1,028 million bus in 2000. If the forecast is realized, the 2022 carryover would be the lowest in seven years. The average of pre-report trade estimates for the 2022 carryover was 730 million bus.
The carry-in supply for 2021-22 (equating to the 2021 carryover) was raised 20 million bus from the April outlook as the USDA lowered its forecast for 2020-21 wheat exports by 20 million bus, to 965 million, and its forecast for food use of wheat in 2020-21 by 5 million bus, to 960 million bus. The lower use forecasts more than offset a lower projection for 2020-21 wheat imports at 105 million bus, down 5 million from April.
The outlook for 2021-22 included a 2021 wheat production forecast at 1,872 million bus, up 46 million bus, or 3%, from 1,826 million bus in 2020 and compared with 1,932 million bus in 2019. The production forecast incorporated the first survey-based winter wheat production projection of the season at 1,283 million bus. This inferred a spring wheat, including durum, outturn in 2021 at 589 million bus. The spring wheat outlook was based on a planted area as presented in the Prospective Plantings report issued on March 31 along with average abandonment and trendline yields.
The USDA forecast 2021-22 wheat imports at 125 million bus, up 20 million bus from 105 million bus in 2020-21. Total wheat supply in 2021-22 was projected at 2,869 million bus, down 90 million bus, or 3%, from 2,959 million bus in 2020-21 and compared with 3,117 million bus in 2019-20.
The USDA projected wheat disappearance in 2021-22 at 2,095 million bus, up 7 million bus from the forecast 20,088 million in 2020-21 and compared with 2,089 million bus in 2019-20.
Domestic use of wheat in 2021-22 was projected at 1,195 million bus, up 72 million bus, or 6%, from 1,123 million bus in both 2020-21 and 2019-20. The USDA forecast food use of wheat in 2021-22 at 963 million bus versus 960 million bus as the projection for the current year. Seed use of wheat was projected at 62 million bus compared with 63 million bus in 2020-21. Feed and residual use of wheat in 2021-22 was projected at 170 million bus, up 70 million bus, or 70%, from 100 million bus in 2020-21. The USDA in commentary accompanying the report said, “A reduced wheat-corn price spread is expected to raise wheat feeding in the June-August quarter with annual feed and residual use projected at 170 million bus, the highest since 2013-14.”
The USDA forecast 2021-22 wheat exports at 900 million bus, down 65 million bus, or 7%, from 965 million bus as projected for 2020-21.
“Several major exporters are projected to have larger supplies in 2021-22, and relatively high US prices are expected to reduce US competitiveness,” the USDA said.
The USDA projected the average farm price of wheat in 2021-22 at $6.50 a bu compared with $5.05 a bu in 2020-21 and $4.58 a bu in 2019-20.