Noting that lower production, mainly in Australia, Canada, Argentina and the EU, was partially offset by higher production in Ukraine, USDA put global wheat supply at 1,054 million tons, down 7.2 million tons from its August forecast. If realized, this would be the first year-on-year decline in world wheat production since the 2018/19 season. 

After 3 years of record production, USDA forecasts global wheat production for the 2023/24 season to decline due to lower yields in many major exporting countries. USDA’s world wheat yield forecast for the 2023/24 season is 787 million tons. This is 3 million tons below last season’s production and 6 million tons below the August forecast. Among the top ten exporters, the EU, Russia, Canada, Australia and Kazakhstan are all projected to see year-on-year yield declines. Australia is reduced 3 million tons to 26 million as dry weather past month in Western Australia, New South Wales, and Queensland lowers yield prospects. Canada is decreased 2 million tons to 31 million on the initial model-based forecast by Statistics Canada for the 2023/24 crop, indicating lower yields from last year arising from dry conditions across the Prairies.

WHEAT CONSUMPTION TO BREAK RECORD

Despite the decline in global wheat supply, the forecast for world wheat consumption is almost unchanged. USDA forecasts that world wheat consumption will exceed production in 2023/24, setting a record high. USDA forecasts world wheat consumption in 2023/24 at 796 million tons, with declines in food, seed and industrial use largely offset by increases in feed and residual use.  

USDA also cut its global wheat trade forecast by 2.1 million tons from last month to 207 million, with declines in Australia, Canada and the EU partially offset by increases in Russia and Kazakhstan. USDA projected world ending stocks at 258 million tons, down 7 million tons from August. This means that ending stocks fell to the lowest level since the 2015/16 season. In an already tight supply outlook, many major exporting countries will resort to wheat stocks to meet rising demand. The biggest year-on-year declines will be in the EU and Russia. Total ending stocks in the world’s top ten wheat exporters (Russia, the EU, Ukraine, the US, Canada, Australia, Kazakhstan, Argentina, Turkey, Turkey and Brazil) are projected to fall to 60 million tons. This would mean that stocks at major exporters would fall to their lowest level since the 2012/13 season. Exporter stocks are a key metric in determining availability of supplies for the global market.