USDA’s latest World Agricultural Supply and Demand Report offers few changes to the outlook for corn, soybeans and wheat. Released yesterday (April 11, 2023), this month’s 2022/23 U.S. corn outlook predicts reductions to imports and food, seed, and industrial use, with unchanged ending stocks.
Corn imports are lowered ten million bushels based on observed trade to date. The season-average farm price was unchanged at $6.60 per bushel. The U.S. soybean supply and use forecasts for 2022/23 are unchanged relative to last month. Soybean and soybean meal prices are also unchanged. The soybean oil price is projected at 64.0 cents per pound, down two cents.
This is the second-straight month USDA did not change the season-average soybean price per bushel, at $14.30. This month’s outlook for 2022/23 U.S. wheat predicts slightly higher supplies, reduced domestic use, unchanged exports, and increased ending stocks. The 2022/23 season-average farm price is forecast $0.10 per bushel lower at $8.90.
WHEAT: The outlook for 2022/23 U.S. wheat this month is for slightly higher supplies, reduced domestic use, unchanged exports, and increased ending stocks. Supplies are raised 5 million bushels on higher imports, based on the pace of Census imports reported to date. Domestic use is lowered 25 million bushels on reduced feed and residual use, which is decreased to 55 million. The downward revision is based on the implied disappearance for the second and third quarters indicated in the NASS Grain Stocks report. Wheat exports remain at 775 million bushels but there are offsetting by-class changes for White and Hard Red Spring exports. Projected 2022/23 ending stocks are raised 30 million bushels to 598 million but are still 14 percent below last year. The 2022/23 season-average farm price is forecast $0.10 per bushel lower at $8.90, based on NASS prices reported to date and expectations for cash prices for the remainder of 2022/23.
The global wheat outlook for 2022/23 is for increased supplies, higher consumption, and reduced trade and stocks. Supplies are raised 0.7 million tons to 1,061.1 million, primarily on higher beginning stocks for Syria and increased production for Ethiopia. Global consumption is increased 2.9 million tons to 796.1 million, mainly on higher food, seed, and industrial use for India, and increased feed and residual use for China and the EU. World trade is lowered 1.2 million tons to 212.7 million on reduced exports by the EU, Argentina, and Brazil more than offsetting increases for Russia and Ukraine. China’s wheat imports are raised 2.0 million tons to 12.0 million, which would be the highest imports for China since 1995/96. China’s imports are raised on strong imports to date, particularly from Australia; China is now the leading 2022/23 global wheat importer. Projected 2022/23 world ending stocks are lowered 2.1 million tons to 265.1 million, the lowest since 2015/16. This month, India, the Philippines, and Ukraine are projected to have lower stocks, more than offsetting increases for Syria, the EU, and the United States.
COARSE GRAINS: This month’s 2022/23 U.S. corn outlook is for reductions to imports and food, seed, and industrial (FSI) use, with unchanged ending stocks. Corn imports are lowered 10 million bushels based on observed trade to date. Feed and residual use is unchanged at 5.275 billion based on indicated disappearance during the December-February quarter. FSI is lowered 10 million bushels reflecting cuts to corn used for glucose and dextrose and starch. With supply and use falling by the same amount, ending stocks are unchanged at 1.342 billion bushels. The season-average farm price is unchanged at $6.60 per bushel.
Global coarse grain production for 2022/23 is forecast 3.3 million tons lower to 1,436.3 million. This month’s foreign coarse grain outlook is for declines in production, trade, and ending stocks relative to last month. Foreign corn production is forecast down as cuts for Argentina, the EU, Serbia, and Uruguay are partially offset by an increase for Russia. For Argentina, production is lowered as continued heat during March diminishes yield prospects for late-planted corn, despite locally beneficial precipitation during the month. EU corn production is reduced, mostly reflecting declines for Hungary, Italy, and Bulgaria that are partly offset by increases for Germany and Poland. Russia corn production is higher reflecting increases to both area and yield. Foreign barley production is higher on an increase for the EU.
Major global trade changes include lower forecast corn exports for Argentina, Mexico, Burma, and Serbia, with increases for Ukraine and Russia. Corn imports are lowered for Egypt, the United States, Thailand, and Venezuela but raised for the EU, Turkey, and Uruguay. Foreign corn ending stocks are lower mostly reflecting declines for Ukraine, the EU, Mexico, and Serbia that are partly offset by increases for Russia and Brazil. Global corn ending stocks, at 295.3 million tons, are down 1.1 million from last month.
RICE: This month’s supply and demand outlook for 2022/23 U.S. rice is for smaller supplies, increased domestic and residual use, higher exports, and reduced ending stocks. Supplies are reduced as the import forecast is lowered 2.0 million cwt to 40.0 million on a lower-than-expected pace of long-grain imports. All rice imports continue to be at a record level, however. Based on the NASS March 31 Rice Stocks report, long-grain domestic use is raised 2.0 million cwt to 119.0 million and medium- and short-grain use is raised 2.0 million cwt to 32.0 million. The 2022/23 rice export forecast is raised 2.0 million cwt to 61.0 million (all long-grain) on large February Census exports and additional sales to Iraq in late March under a 2022/23 Memorandum of Understanding. Despite this increase, U.S. exports would still be the lowest since 1985/86. In aggregate, these supply and use revisions result in an 8.0-million-cwt reduction in ending stocks to 28.1 million, the lowest since 2003/04. The long-grain season-average farm price (SAFP) is unchanged at $16.90 per cwt. While the all medium- and short-grain SAFP price is also unchanged at $29.20 per cwt, the SAFP for Other States was raised $0.10 per cwt to $17.70.
The 2022/23 global outlook is for lower supplies, increased trade, fractionally higher use, and reduced ending stocks. Global beginning stocks are lowered 1.4 million tons to 182.0 million based almost entirely on a multi-year adjustment to use and stocks in the Philippines to better match observed current stock levels. World production is decreased 0.4 million tons to 509.4 million as reduced estimates for Indonesia, Brazil, and Iraq more than offset an increase for Bangladesh. Indonesia’s 2022/23 rice production is reduced 0.6 million tons to 34.0 million on lower area and yield for its main-season rice crop that was harvested in February and March. Global trade in 2022/23 is raised 0.8 million tons to 55.7 million, with increased exports for Vietnam and Thailand, in part to account for Indonesia’s intention to significantly increase rice purchases in 2023. Total ending stocks are projected 2.0 million tons lower to 171.4 million, primarily on decreases for the Philippines and China. At this level, ending stocks would be 6 percent lower than in 2021/22 and the lowest since 2017/18.
OILSEEDS: U.S. soybean supply and use forecasts for 2022/23 are unchanged relative to last month. Soybean and soybean meal prices are also unchanged. The soybean oil price is projected at 64.0 cents per pound, down 2 cents.
Global 2022/23 soybean supply and demand forecasts include lower production, crush, and exports. Global soybean production is reduced 5.5 million tons to 369.6 million. Lower crops for Argentina and Uruguay are partly offset by higher production for Brazil. Soybean production for Argentina is lowered 6.0 million tons to 27.0 million on hot and dry weather conditions through March. Uruguay production is lowered 0.9 million tons to 1.2 million on a lower harvested area and yield. Partly offsetting is higher production for Brazil which is increased 1.0 million tons to 154.0 million on higher area.
Soybean crush is lowered on reduced supplies and slow pace to date for Argentina, China, Bangladesh, Pakistan, and Egypt. Crush for Argentina is reduced 3.3 million tons to 32.0 million leading to lower product exports. Partly offsetting is higher crush and higher soybean oil and meal exports for Brazil. Soybean exports are lowered 0.4 million tons to 168.0 million mainly on lower exports for Uruguay. Imports are lowered for Bangladesh, Egypt, and Pakistan and raised for Argentina. Soybean ending stocks are raised fractionally with higher stocks for China and Brazil that are mostly offset by lower stocks for Argentina.
SUGAR: U.S. sugar supply is increased by 176,692 short tons, raw value (STRV) to 14.637 million on increased imports from last month. On March 13, 2023, USTR announced the reallocation of 247,182 STRV from countries that stated they do not plan to ship their original raw sugar TRQ allocation. USDA projects that only 46.5 percent of the reallocation, or 114,905 STRV, will enter, implying a new shortfall projection of 132,277, down from 254,632 projected last month. High-tier tariff imports are increased to 225,000 STRV on raw sugar imported during March by a refiner and by an increase in projected monthly refined imports based on the pace to date. There is a small partial offset of 10,179 STRV from combined calendar year 2022 FTA TRQs where the sugar failed to enter before December 31. Beet sugar production is down by 10,285 STRV on slightly lower recovery and a corresponding small increase in beet pile shrink. Cane sugar production is up 5,430 STRV on processor reporting in Florida and Texas. Because sugar use is unchanged, ending stocks increase by the full extent of the supply increase to 1.897 million STRV, resulting in an increase in the ending stocks-to-use ratio to 14.89 percent.
Mexico sugar production is increased by 75,000 metric tons (MT) to 5.560 million. It is projected that area harvested will be close to the 828,941 hectares (ha) projected by CONDADESUCA but remains below in yield (USDA’s projection of 61.07 MT/ha against 62.37) and below in sucrose recovery (10.98 percent against 11.20). The production increase flows through to an increase in IMMEX deliveries to 331,037 MT and in ending stocks to 937,216 MT.
On March 29, the Department of Commerce indicated that the government of Mexico stated that Mexico will be able to supply U.S. sugar needs of 1.118 million MT during the remainder of the Export Limit period. USDA projects Mexico production of below 99.2 polarity sugar could be as high as 840,000 MT or about 75 percent of allocation. USDA continues to project lower deliveries to IMMEX to maintain Mexico sugar supply and use balance for 2022/23, assuming that Mexico will export up to its Export Limit. USDA projects Mexico imports for IMMEX at 25,000, unchanged from last month.
LIVESTOCK, POULTRY, AND DAIRY: For 2023, the beef production forecast is raised from last month. Higher expected placements of cattle during the first half are reflected in higher forecast beef production during the second half. Pork production is raised in the first half on recent slaughter data and revisions to 2022 pig crop data but is lowered in the second half, as the December-February pig crop and producer farrowing intentions for March-May, published in the latest Quarterly Hogs and Pigs report, were lower than previously expected. Broiler production is raised for the first half on recent slaughter and hatchery data. Turkey production is unchanged. Egg production is reduced slightly for the second and third quarters on recent flock and production data.
Export projections for beef are raised on recent trade data and expectations of sustained demand in a number of Asian markets. Imports are also raised on recent data and projections of increased supplies from Oceania. Pork exports and imports are both raised on recent data. Broiler and turkey exports are raised on recent data, and imports are reduced on recent discoveries of highly pathogenic avian flu outbreaks in Chile.
Cattle prices for the first quarter are lowered slightly on reported data but raised for all other quarters on continued strength in demand. Hog prices are lowered for all four quarters reflecting current price movements and continued modest demand. Broiler prices are projected higher on the strength of demand. Turkey prices are raised on current price movements. Egg prices are raised for the first quarter on reported prices but the forecast for the remaining quarters is unchanged.
The milk production forecast is higher on a larger expected cow inventory. Fat basis imports for 2023 are primarily raised on the strength of a number of dairy products during the first quarter. Imports of casein and milk protein concentrates are expected to remain firm, supporting higher skim-solids basis imports through the year. Expectations of increased competition in butter, cheese, nonfat dry milk, and whey markets are reflected in lower forecast exports on both a fat- and a skim-solids basis for 2023.
Cheese and butter prices are raised on recent prices. Nonfat dry milk prices are lowered. Whey prices are raised on recent price observations and stronger expected demand. With the changes in component prices, Class III prices are projected higher, while Class IV prices are projected lower. The all milk price is projected higher at $20.65 per cwt.
COTTON: The 2022/23 U.S. cotton supply and demand forecasts show higher exports and lower ending stocks relative to last month, with production and domestic mill use unchanged. The export forecast is raised 200,000 bales, to 12.2 million, based on the pace of recent sales and shipments. Ending stocks are now forecast at 4.1 million bales, equivalent to 29 percent of total disappearance. The marketing year price received by upland cotton producers is projected to average 82 cents per pound, a decrease of 1 cent from last month.
In the global 2022/23 cotton balance sheet, higher production and reduced trade are contributing to higher ending stocks. World production is forecast 829,000 bales higher than in March as a 1-million-bale increase for China more than offsets a lower Brazilian crop. World 2022/23 ending stocks are projected 867,000 bales higher, with the largest increase in India, where projected stocks are 450,000 higher on lower exports. The expected volume of world trade in 2022/23 is 745,000 bales lower this month, with imports reduced for Bangladesh, China, and Turkey. On the export side, higher U.S. and Australia exports are more than offset by a 550,000-bale reduction for Brazil and a 400,000-bale reduction for India. Projected 2022/23 global consumption is 65,000 bales higher this month as a 500,000-bale increase for China more than offsets declines in Bangladesh and Turkey.
Approved by the Secretary of Agriculture and by the Chairman of the World Agricultural Outlook Board, Mark Jekanowski, (202) 720-6030. This report was prepared by the Interagency Commodity Estimates Committees.
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