World Agricultural Supply and Demand Estimates Report - WASDE - 514, January 11, 2013
WHEAT: Projected U.S. wheat ending stocks for 2012/13 are lowered 38 million bushels this month. Feed and residual use is projected 35 million bushels higher as December 1 stocks, reported in the January Grain Stocks, indicate higher-than-expected disappearance during September-November. Seed use is raised 2 million bushels based on the winter wheat planted area reported in Winter Wheat Seedings. Projected exports for all wheat are unchanged; however, Hard Red Winter (HRW) wheat exports are lowered 25 million bushels and Soft Red Winter (SRW) wheat exports are raised 25 million bushels based on the pace of sales and shipments to date and the increasing competitiveness of SRW wheat in world markets. All wheat imports are also unchanged, but small adjustments raise projected HRW wheat imports 5 million bushels and reduce Hard Red Spring wheat and Durum imports by a combined 5 million bushels. The projected range for the 2012/13 season-average farm price for all wheat is lowered 10 cents at the midpoint and narrowed to $7.65 to $8.15 per bushel, based on prices reported to date.
Global wheat supplies for 2012/13 are projected slightly lower based on reduced production prospects in Argentina and lower reported production in Russia. Argentina production is reduced 0.5 million tons with lower expected harvested area and yields. Heavy December rains have increased expected area losses and harvest reports also suggest lower-than-expected yields. Russia production is lowered 0.3 million tons based on the latest government reports that reduce yields slightly.
Global wheat exports for 2012/13 are reduced slightly. Projected exports are lowered 0.5 million tons each for Argentina, Australia, and Canada, but raised 0.5 million tons for Russia and 0.2 million tons for Ukraine. Imports are raised 0.2 million tons for Iran. Feed and residual use for Russia is lowered 0.5 million tons as available domestic supplies tighten. World wheat ending stocks for 2012/13 are projected slightly lower with increases for Australia, Canada, and Iran mostly offset by reductions for the United States, Russia, and Ukraine.
COARSE GRAINS: U.S. 2012/13 feed grain supplies are increased slightly with higher corn production more than offsetting a reduction for sorghum. Harvested area for corn is lowered 346,000 acres, but a 1.1-bushel-per-acre increase in the estimated yield boosts production 55 million bushels. Sorghum harvested area is nearly unchanged, but a 1.3-bushel-per-acre decrease in the estimated yield lowers production 9 million bushels.
Projected corn use for 2012/13 is raised with higher expected feed and residual disappearance more than offsetting reduced prospects for exports. Feed and residual use is projected 300 million bushels higher based on September-November disappearance as indicated by December 1 stocks and on higher expected beef, pork, and poultry production. Corn exports are projected 200 million bushels lower reflecting the slow pace of sales and shipments to date and increasing pressure from larger supplies and exports for South America. Corn ending stocks are projected 44 million bushels lower at 602 million. The season-average farm price for corn is unchanged at $6.80 to $8.00 per bushel. While stiff competition has limited U.S. corn exports, higher domestic disappearance leaves the balance sheet historically tight and is expected to support continued strong and volatile prices well into summer, particularly in the domestic cash markets.
Other 2012/13 feed grain changes this month include increases in projected sorghum, barley, and oats feed and residual disappearance as indicated by the December 1 stocks. Sorghum exports are projected 35 million bushels lower with feed and residual use projected up 50 million bushels. Oats exports are lowered 1 million bushels, based on the pace of sales and shipments to date. The season-average sorghum farm price is raised 20 cents at the midpoint to $6.70 to $7.90 per bushel. The barley farm price is projected down 5 cents at the midpoint to $6.10 to $6.70 per bushel on lower reported prices for malting barley. The projected oats farm price range is narrowed 5 cents on each end of the range to $3.60 to $4.00 per bushel.
Global coarse grain supplies for 2012/13 are projected 2.9 million tons higher mostly reflecting the larger U.S. corn crop and increased corn production for South America. Paraguay corn production is raised 1.1 million tons on a higher projected yield, which is in line with historical yield and production revisions this month. Brazil corn production is raised 1.0 million tons on higher expected yields with favorable December rainfall across the southern growing areas. Argentina corn production is raised 0.5 million tons as lower harvested area is more than offset by higher expected yields. Heavy rains and flooding in November and December delayed planting and reduced area prospects. Since then, clearing weather, the absence of threatening heat, and abundant soil moisture have set the stage for strong year-to-year yield increases, particularly in the central growing region. Partly offsetting these increases are reductions in corn output of 0.5 million tons for Russia and 0.1 million tons each for the Philippines and Serbia. Changes for Russia and Serbia reflect the latest government estimates. The smaller expected crop in the Philippines is based on the latest assessment of typhoon damage in December.
Changes to 2012/13 global coarse grain exports, in the aggregate, are small this month, but increases in 2011/12 and 2012/13 local year corn exports for South American countries have substantial implications for U.S. corn exports during the 2012/13 September-August marketing year. Exports for Argentina are raised 0.5 million tons for 2011/12 and 1.0 million tons for 2012/13. Exports for Brazil are raised 0.5 million tons for 2011/12 and 1.5 million tons for 2012/13. With the local marketing years in both of these Southern Hemisphere countries running from March through February, increases in both years weigh against U.S. export prospects for 2012/13. Similarly, in Paraguay, where the local marketing year runs from January through December, corn exports are boosted 0.6 million tons and 0.5 million tons, respectively, for 2011/12 and 2012/13, also reducing prospects for U.S. corn exports during the current marketing year. EU-27 corn exports are also raised 0.5 million tons for 2012/13.
Global corn consumption for 2012/13 is raised 5.6 million tons mostly on the increase in U.S. corn feeding this month. Consumption is raised slightly for Paraguay, but lowered slightly for Russia and Serbia. Global corn ending stocks for 2012/13 are projected 1.6 million tons lower with lower expected stocks in the United States, Brazil, and Argentina. Stocks are raised for Paraguay with the larger projected crop.
RICE: The U.S. 2012/13 rice crop is estimated at 199.5 million cwt, up 0.9 million from the previous estimate. Average yield is estimated at a record 7,449 pounds per acre, up 32 pounds per acre from last month, and an increase of 382 pounds per acre from 2011/12. Harvested area is estimated at 2.678 million acres, up 1,000 acres from the previous estimate. Long-grain rice production is estimated at 144.2 million cwt, up 4.3 million from last month, and combined medium- and short-grain production is lowered 3.4 million to 55.3 million. Rice imports for 2012/13 are unchanged from last month.
The National Agricultural Statistics Service’s (NASS) Rice Stocks reported total rough rice stocks at 147.6 million cwt as of December 1 and total milled stocks at 6.9 million (9.8 million cwt on a rough-equivalent basis). Total rice stocks on a rough-equivalent basis are 157.4 million, up 1 percent from a year earlier. Long-grain stocks as of December 1 are estimated at 96.7 million (rough-equivalent basis) and combined medium- and short-grain stocks at 51.4 million.
Rice 2012/13 domestic and residual use is unchanged at 125.0 million cwt. Long-grain domestic and residual use is projected at 94.0 million, up 1.0 million from a month ago. Combined medium- and short-grain domestic use is lowered 1.0 million cwt to 31.0 million. The all rice export projection is raised 1.0 million cwt to 106.0 million, all in the long-grain class, up 4 percent from the preceding year. The pace of exports and sales of long-grain rice have been brisk based on Census data through October and U.S. Export Sales data through early January. Long-grain exports have been particularly strong to Western Hemisphere markets including Colombia, Central America, Haiti, and Venezuela. The 2012/13 rough rice export projection is unchanged at 34.0 million cwt, but up 4 percent from the prior year. Exports of milled rice are increased by 1.0 million cwt to 72.0 million, up 4.5 percent from 2011/12. All rice ending stocks for 2012/13 are projected at 30.1 million cwt, nearly unchanged from last month, but a decrease of 27 percent from a year ago. Long-grain rice ending stocks are forecast at 17.4 million cwt, up 2.3 million from last month, but a decrease of 28 percent from 2011/12. Combined medium- and short-grain rice ending stocks are projected at 10.5 million cwt, down 2.4 million from last month, and a decline of 29 percent from last year.
The 2012/13 long-grain season-average farm price range is projected at $13.70 to $14.70 per cwt, unchanged from last month, and the combined medium- and short-grain farm price range is projected at $16.00 to $17.00 per cwt, down 50 cents per cwt on each end of the range. The all rice season-average farm price is forecast at $14.40 to $15.40 per cwt, down 10 cents per cwt on both ends of the range.
World 2012/13 rice total supplies are virtually unchanged as a slight increase in production is more than offset by a reduction in beginning stocks. Global beginning stocks for 2012/13 are forecast down nearly 200,000 tons due mostly to reductions for Japan and Thailand that are partially offset by increases for China, and Pakistan. Global rice production is projected at a record 465.6 million tons, up 0.2 million from last month due primarily to higher forecasts for Argentina, Brazil, and Pakistan partially offset by a decrease for Cambodia. Brazil’s 2012/13 rice crop is raised 340,000 tons to 8.16 million tons, due mostly to an increase in average yield, based on the latest government report from Brazil. Brazil’s average rice yield has been trending higher in recent years as farmers are utilizing a larger share of higher yielding varieties and fully irrigating a larger share of the crop. Global consumption for 2012/13 is forecast at a record 468.6 million tons due mostly to increases in Sub-Saharan Africa. Global 2012/13 trade is raised 1.1 million tons to 37.7 million, down 1.3 million from the record in 2011/12. Export projections are raised for Argentina, Brazil, India, the United States, and Vietnam and lowered for Pakistan. Import forecasts for 2012/13 are raised for Sub-Saharan Africa. World ending stocks for 2012/13 are projected at 102.5 million tons, nearly unchanged from last month, and a decrease of 3.0 million from the prior year. Ending stocks are lowered for India, Thailand, and Vietnam, but raised for Brazil, Nigeria, and Pakistan.
OILSEEDS: U.S. oilseed production for 2012/13 is estimated at 92.7 million tons, up 1.4 million tons from last month. Larger crops for soybeans, sunflowerseed, and peanuts are partly offset by reductions for canola and cottonseed. Soybean production is estimated at 3.015 billion bushels, up 44 million bushels based on increased yields and harvested area. The soybean yield is estimated at 39.6 bushels per acre, up 0.3 bushels from the previous estimate. Soybean crush is raised 35 million bushels to 1.605 billion bushels reflecting higher projected domestic soybean meal consumption and increased soybean meal exports. Soybean meal domestic consumption is raised in line with projected gains in meat production, especially for pork and poultry. Soybean exports are unchanged at 1.345 billion bushels. Soybean ending stocks for 2012/13 are projected at 135 million bushels, up 5 million from last month. Soybean oil balance sheet changes include increased production, exports, and ending stocks.
The projected range for the 2012/13 season-average soybean price is lowered 30 cents at the midpoint and narrowed to $13.50 to $15.00 per bushel. The soybean oil price is forecast at 49 to 53 cents per pound, unchanged from last month. The soybean meal price is projected at $430 to $460 per short ton, down 10 dollars on both ends of the range.
Global oilseed production for 2012/13 is projected at a record 465.8 million tons, up 2.8 million due to increases for soybeans, cottonseed, peanuts, and sunflowerseed. Global soybean production is projected at 269.4 million tons, up 1.7 million with gains in the United States and Brazil only partly offset by a lower projection for Argentina. The Brazil soybean crop is increased 1.5 million tons to a record 82.5 million reflecting record area and improving yield prospects. Higher projected yields are the result of favorable moisture throughout the center west and southern growing areas. The Argentina soybean crop is projected at 54 million tons, down 1 million mainly due to lower projected area resulting from excessive moisture throughout much of the central growing area. Other changes include increased cottonseed production in China and Australia, and increased sunflowerseed production in India and the United States.
Global oilseed trade for 2012/13 is projected at 115.3 million tons, up slightly from last month. Increased soybean exports for Brazil are offset by a comparable reduction for Argentina. Higher soybean meal exports mainly reflect increases for the United States and China. Soybean meal consumption and imports are projected higher for several countries including Indonesia, South Korea, Mexico, Russia, and Iran. Global oilseed ending stocks are projected at 66.6 million tons, down 0.3 million from last month as reduced soybean stocks in Argentina and China are only partly offset by higher stocks in Brazil and the United States.
SUGAR: Projected U.S. sugar supply for fiscal year 2012/13 is increased 152,000 short tons, raw value, from last month, due to higher beginning stocks and production. Sugar production in Louisiana is increased 150,000 tons based on processors’ estimates. Contributing factors to Louisiana’s large sugar crop include ideal planting and growing weather for sugarcane, improved varieties, and lack of significant freezes during harvest. Sugar use is unchanged.
LIVESTOCK, POULTRY, AND DAIRY: The 2013 forecast of total red meat and poultry production is raised from last month, reflecting greater beef, pork, broiler, and turkey production. Beef production is raised from last month based primarily on heavier carcass weights. USDA will release its Cattle report on February 1, providing an indication of producer intentions for heifer retention in 2013 and feeder cattle availability. USDA’s December 28 Quarterly Hog and Pigs report estimated that the pig crop for the last half of 2012 was about the same as 2011, while indicating producers plan to farrow 1 percent fewer sows the first half of 2013 relative to 2012. However, continued growth in pigs per litter in 2013 is expected to more than offset the decline in intended farrowings. Coupled with slightly higher expected carcass weights, the 2013 pork production forecast is raised from last month. Broiler production is raised as higher forecast broiler prices and lower forecast soybean meal prices are expected to enhance sector profitability. Hatchery data are pointing toward higher-than-previously forecast production and bird weights have increased. Turkey production is higher based on current hatchery data and expectations of lower soybean meal costs. The egg production forecast is raised on hatchery data. Estimates for 2012 beef and pork production are raised slightly based on late-year production data, but the estimates for poultry are unchanged.
The forecast for beef exports in 2012 is raised based on recent trade data but is unchanged for 2013. The import forecast is lowered for both 2012 and 2013 as global supplies of beef are expected to remain relatively tight. Pork export forecasts for 2012 and 2013 are raised from last month based on expected greater availability of pork and continued firm demand. Broiler export forecasts in 2012 and 2013 are unchanged from last month. Turkey export forecasts for both 2012 and 2013 are higher this month.
Cattle prices for first-quarter 2013 are raised, reflecting current demand conditions for fed cattle. Hog prices for 2013 are forecast lower based on larger expected hog supplies. Broiler prices for 2013 are raised from last month on expected demand strength. Turkey prices are lowered as production is forecast higher. Egg prices are lowered from last month. Prices for 2012 are adjusted to reflect reported December estimates.
The milk production forecast for 2012 is increased based on a slower decline in cow numbers and greater output per cow in the fourth quarter. Milk production for 2013 is raised as the decline in cow numbers is dampened from last month. Fat-basis imports for 2012 and 2013 are raised on higher butterfat and cheese imports, but skim-solids imports for 2012 are reduced on lower casein imports. Fat-basis exports are unchanged for 2012, but the forecast for 2013 is raised on greater expected cheese and whey sales. The estimate for 2012 skim-solids exports is reduced on lower nonfat dry milk (NDM) exports but the forecast for 2013 is raised.
Butter and cheese prices for 2013 are lowered based on current price weakness and weaker expected demand. NDM and whey prices for 2013 are forecast higher on current price strength. The Class III price forecast is reduced as lower forecast cheese prices more than offset the higher whey price. The Class IV price is lowered as the forecast decline in butter prices more than offsets higher NDM prices. The all milk price forecast is lowered to $18.85 to $19.65 per cwt. Product and milk prices for 2012 are adjusted to reflect reported December estimates.
COTTON: The 2012/13 U.S. cotton estimates include lower production and higher offtake, resulting in lower ending stocks relative to last month. Production is lowered 1 percent as a 500,000-bale reduction for Texas—due to larger estimated abandonment—is partially offset by increases in other states. Domestic mill use is unchanged, but exports are increased 400,000 bales to 12.2 million, reflecting larger estimated import demand by China and supportive data on U.S. export sales to date. Ending stocks are now forecast at 4.8 million bales, equal to 31 percent of total use. The projected range for the average price received by producers of 66-71 cents per pound is raised 1 cent on the lower end.
This month’s world 2012/13 estimates shows higher production and slightly lower consumption, resulting in ending stocks of 81.7 million bales. Production is raised mainly in China, where recent levels of cotton classings and purchases for the national reserve indicate that the crop is larger than previously estimated. Production is also raised in Australia but is lowered in the United States. Global consumption is revised down slightly, mainly reflecting a reduction for India. A 1.0-million-bale increase for China’s imports is boosting world trade, and exports are raised for India, the United States, Brazil, and Australia. China’s imports are forecast higher due to strong imports to date and tight free stocks resulting from the large accumulation of cotton in the national reserve. World stocks are increased 2.5 percent from last month.
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