There has been a trend of increasing wheat production worldwide and fewer U.S. acreage — that decrease happening since the 1980s and during that same time period U.S. wheat exports have also been trending lower according to the USDA 10-year Ag Projections Report.
USDA Analyst David Stallings shares what the report forecasts for the next decade.
Stallings: “We faced increased competition not only from our traditional competitors — the E.U., Argentina and Australia — but increasingly from the former Soviet Union – particularly Russia, Ukraine, Kazakhstan. In fact what we see is that the U.S. trade share in wheat actually declines over the forecast period from almost 19 percent now to around 17 percent at the end of the period.”
Wheat prices in the U.S. also expected to trend downward from about $6.80 bushel this season to $5.35 in 2023.
Now in the short-term, however, with the recent political unrest in the Ukraine, and a lower U.S. dollar there might be more opportunity for U.S. wheat as Top Third’s Chris Robinson shares.
Robinson: “We are going to have to watch and see what happens to the Ukraine. They are a big grain exporter and if anything gets gummed up over there because of what is going on politically, if you’ve been watching the news. That could affect exports because if it is difficult to get grain out of the Black Sea, it could be easier for somebody to go somewhere else. Hopefully that will help U.S. farmers.”
(Source – http://www.blackseagrain.net/novosti/worldwide-wheat-production-10-year-forecast)