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WASDE: Wheat stocks decline, corn production skyrockets

26 January 20246 min reading

The WASDE January 2024 report highlights a nuanced global wheat scenario, featuring a decline in U.S. ending stocks but a significant worldwide surge in supplies, consumption, trade, and ending stocks for the 2023/24 season. In the U.S. corn sector, a record-setting production of 15.3 billion bushels prompts notable shifts in trade and stocks, capturing attention in the broader coarse grains market. Increased feed and residue use in India and the European Union has boosted global wheat consumption volumes.

The most recent World Agricultural Supply and Demand Estimates (WASDE), compiled and issued by the World Agricultural Outlook Board (WAOB), the USDA’s central hub for economic intelligence and global commodity outlooks, presents a thorough analysis of the international agricultural scene. This report illuminates vital trends and forecasts for key commodities, providing valuable insights for stakeholders. With a primary focus on wheat, coarse grains, and oilseeds, the report not only presents essential numerical data but also provides valuable insights and analyses to guide stakeholders and policymakers in navigating the complexities of the international agricultural markets.

GLOBAL WHEAT SURGE FUELED BY FEED AND RESIDUE

The global wheat outlook for the 2023/24 season reflects a nuanced landscape. While the United States anticipates a reduction in ending stocks due to decreased supplies, the overall global scenario presents a contrasting picture. Worldwide, supplies, consumption, trade, and ending stocks are expected to increase compared to the previous month. Factors influencing this shift include higher beginning stocks and production. Notably, Ukraine’s revised feed and residual use estimates significantly impact the global beginning stocks. The global consumption uptick is primarily driven by increased feed and residual use for India and the EU. Projections also indicate a rise in world trade, with notable increases in exports by Ukraine, Russia, Australia, and Canada, offsetting a decrease for the EU. Ending stocks for 2023/24 are projected to rise, primarily due to increases in the EU and Ukraine.

US CORN PRODUCTION PEAKS

In the realm of coarse grains, the 2023/24 U.S. corn outlook paints a picture of heightened production, increased food, seed, and industrial use, augmented feed and residual use, and higher ending stocks. The global coarse grain production forecast for 2023/24 also sees a substantial uptick, driven by larger production across various countries. Noteworthy changes include increased corn exports for Turkey and reduced exports for Brazil and India. Foreign corn ending stocks register an increase, primarily due to higher stocks in China. With a record-setting corn production estimated at 15.3 billion bushels in the U.S., the coarse grains market is poised for significant shifts in trade and stocks.

U.S. OILSEED PRODUCTION SURGES, BRAZIL’S STOCKS DIP

The 2023/24 U.S. oilseed production outlook presents a mixed scenario with estimates indicating higher production for soybeans, rapeseed, and sunflowerseeds but lower figures for peanuts and cottonseed. Global soybean production witnesses changes, with increased forecasts for Argentina, the United States, Russia, China, Paraguay, and Bolivia counteracted by a decrease in Brazil. Argentina and Paraguay experience improved yield prospects due to early-season rainfall. Despite reductions in global sunflowerseed production, the soybean market anticipates stable trade, slightly lower exports for Brazil offset by increases for Paraguay and Russia. Ending stocks are forecasted to increase for the United States and Argentina, with a corresponding decrease in Brazilian stocks.

LIVESTOCK, POULTRY, AND DAIRY

The latest WASDE report provides a comprehensive overview of the livestock, poultry, and dairy sectors, revealing significant changes in production estimates and trade dynamics for the year 2023 and projections for 2024.

Upward adjustments in meat and poultry production figures

Red meat and poultry production for 2023 have been revised upward, driven by increased beef, pork, and broiler production in the fourth quarter. The adjustments are based on November production data and preliminary estimates for December slaughter numbers and weights. Notably, egg production has also seen an increase based on updated production and flock data.

1. Aggregate of local marketing years.

2. Based on export estimate. See individual commodity tables for treatment of export/import imbalances.

3. Wheat, coarse grains, and milled rice.

4. Corn, sorghum, barley, oats, rye, millet, and mixed grains (for U.S. excludes millet and mixed grains).


For 2024, the beef forecast is raised, reflecting higher expected first-half cattle slaughter and dressed weights. The upcoming USDA Cattle report, scheduled for release on January 31, is anticipated to provide crucial insights into cattle availability and producer intentions for the breeding herd. The pork production outlook for the first half of 2024 is raised, considering pig crop data for the second half of 2023. Broiler production is also expected to increase in the first half, as indicated by recent hatchery data. However, turkey production faces a reduction in the first half of 2024 due to lower prices and anticipated market pressures. Beef and pork export and import estimates are subject to adjustments based on trade data, with notable changes expected in beef imports from Oceania and weaker sales in several Asian markets. The report also provides price estimates for various livestock and poultry products, offering valuable insights for market participants.

Forecasts point to decreased dairy production

The dairy sector experiences adjustments in milk production forecasts for both 2023 and 2024. Lower milk cow inventories and reduced expected milk per cow contribute to a decrease in production for 2023. The outlook for 2024 is also revised downward, considering a reduced average cow inventory and slower growth in output per cow. The upcoming USDA Cattle report is poised to provide further clarity on producer intentions for retaining dairy heifers. The report also touches upon fat and skim-solids bases imports and exports, offering a nuanced view of the dairy market dynamics. Price forecasts for dairy products in 2024 reflect expectations of price fluctuations based on recent market trends.

CONCLUSION

The WASDE report unveils a dynamic and multifaceted outlook for the global agricultural landscape in the 2023/24 season. With a primary focus on wheat, coarse grains, oilseeds, and livestock, poultry, and dairy sectors, the report provides a holistic understanding of the key trends and projections shaping the international agricultural markets. Noteworthy is the nuanced global wheat scenario, marked by a decline in U.S. ending stocks but a worldwide surge in supplies, consumption, trade, and ending stocks. The U.S. corn outlook signals heightened production, influencing the broader coarse grains market with significant trade and stock shifts. In the oilseed sector, the U.S. witnesses a production surge while Brazil faces a dip in stocks, reflecting the intricate global dynamics. Transitioning to livestock, poultry, and dairy, the sector experiences surges in meat and poultry production, with adjustments in dairy forecasts pointing to decreased production. The imminent USDA Cattle report promises crucial insights for the industry. As stakeholders navigate these complexities, the WASDE report serves as an indispensable guide, offering numerical data alongside insightful analyses to inform strategic decisions. However, the prudent interpretation of these insights must account for external factors, ensuring a comprehensive understanding of the global agricultural trajectory in the face of geopolitical and climatic uncertainties.

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