Agri Commodities Preview: USDA Forecasts 3 Million Tonnes Rise In Global Wheat Supplies During 2017/18

World 2017/18 wheat supplies increased this month by nearly 3.0 million tons as production is raised to a new record of 759.8 million, mainly on Moroccos higher production estimate as it recovered from a severe drought in 2016/17. Global supplies also increased with a multi-year reduction in Irans food, seed, and industrial use, which raised carry-in stocks by nearly 2.0 million tons.

Projected global 2017/18 trade is virtually unchanged on increased exports from Russia, Kazakhstan, and Argentina nearly offsetting lower exports from the EU and other exporters. Russias exports are raised 1.0 million tons to 38.5 million, which surpasses last years record exports by more than 10 million. Russia continues to displace the EU and other exporters in several markets. Imports are lowered for Morocco, Brazil, and Colombia while increased for Algeria, Ethiopia, Japan, Kenya, Turkey, and the Philippines. Projected 2017/18 world consumption is higher, primarily on increases in the EU and Indonesia, which more than offset reductions in Iran, India, and the United States. However, the increase in global supplies still exceeds the additional consumption as 2017/18 global ending stocks are 2.3 million tons higher this month at 271.2 million, a new record.