USDA reduces wheat supply forecast and prices rise in Chicago | Wheat

In its first estimate for the 2024/25 season, the US Department of Agriculture (USDA) indicated that global production of wheat will total 798.2 million tons, 1.3% more than in the current cycle. The season for wheat differs from that of soybeans and corn and officially begins in July.

Russia will remain the world’s largest producer, with a projection of 88 million tons, compared to an estimate of 91.5 million in the current cycle.

The USA, which sets wheat prices on the Chicago Stock Exchange, is expected to produce 50.6 million in the next cycle, just over 1 million tons above current projections. This number was below market expectations, which pointed to an average of 51.7 million for American production in 2024/25.

With regard to Brazil, the American agency’s estimate is that the cereal harvest will be 9.5 million tons, compared to 8.1 million in 2023/24.

Argentina, Brazil’s main supplier, is expected to recover 2 million tons lost in the last harvest and reach 17 million tons.

The USDA projection for world consumption is 802.4 million tons, compared to 800 million currently.

With this situation, the estimated final stocks for 2024/25 are 253.6 million tons, just below the 257.8 million predicted for the end of 2023/24 and the lowest volume since 2015/16. Even so, the relationship between supply and inventory will remain comfortable, at 31.6%.

Harvest 2023/24

Regarding the current season, the USDA raised the global production estimate by 1 million tons, to 787.7 million tons.

Despite this, it corrected its final stock projections downwards from 258.8 million to 257.8 million.

This new stock number, added to supply projections for 2024/25, is causing wheat prices to rise on the Chicago stock exchange at this time. The most traded lots, due in July, are now worth US$6.5525 per bushel, 2.5% more than at the last close.