The US Department of Agriculture (USDA) WASDE report focuses on yield increases in the United States for August. For wheat, maize and soy, production in the country is expected to be higher than estimated last month. This sentiment does not apply to the European Union.
The Department of Agriculture expects U.S. wheat production to reach 2020 billion bushels for the 2021/1,8 season, an increase of 14 million bushels from last month. Most of this additional production will likely be exported, according to the USDA, as consumption is lower (-4 million bushels to 960 million) due to the corona crisis (less food is now consumed outside the home). Another factor is that the ministry has reduced European wheat production by 4 million tons.
Total wheat production in the European Union would therefore amount to approximately 135 million tons, according to the USDA. The fact that the decrease in production in Europe has remained fairly limited is partly due to an increase of 1,5 million tons in Russia. Because total production is lower, the expectation for European exports has also been adjusted downwards: -1,5 million tons. As global consumption declines, global ending stocks are revised upward to a record 316,8 million tonnes.
Soy: higher yields, same area
The United States Department of Agriculture estimates the country's 2020/2021 soybean production at 4,4 billion bushels. That's an increase of 290 million bushels compared to the forecast July. On the other hand, the USDA keeps the expectation for the area the same at 33,5 million hectares. From the first tour of plots, it concludes that yield per acre is approximately 5,9 bushels above last year's level: 53,3 bushels per acre. Because production is expected to be higher, the expected soy price for 2020/2021 in the United States has been lowered to $8,35 per bushel (-$0,15).
For the European Union, the US Department of Agriculture expects a yield of 2,75 million tons, a small increase compared to July expectations. The USDA reports that higher imports from China, Thailand and Egypt, among others, are offset by higher exports from Brazil, Argentina and the United States. For the latter country, exports are expected to amount to approximately 2,13 billion bushels. Due to higher soy production, global ending stocks have increased by 0,3 million tons to 95,4 million tons.
Corn: increase in production increases ending inventory
US corn production has also been corrected by the Ministry of Agriculture compared to the previous month. The USDA expects production of 2020 billion bushels for the 2021/15,3 season, which is 278 million bushels more than the July forecast. In addition, a record yield of 181,8 bushels per acre is also expected, an increase of 3,3 bushels per acre from last month.
In contrast, maize production in the European Union is being reduced (to 163 million tonnes), mainly due to lower yields in Romania and France.