The U.S. winter wheat crop will be the smallest in eight years due to drought in the central and southern Plains, the government said, estimating a harvest of 1.38 billion bushels, 2 percent less than it forecast in May and 10 percent smaller than 2013. In its monthly Crop Production report, USDA forecast smaller harvests in Texas, down 13 percent from May, in Kansas, down 6 percent, and in Oklahoma, down 5 percent – the heart of hard red winter wheat output. Wheat output in Kansas, the No 1 state, will drop by 24 percent from 2013.
Even with a small crop, U.S. wheat supplies will be ample,, with a stocks-to-use ratio of 27 percent this marketing year, said the WASDE report. USDA’s forecasts of corn and soybean stockpiles at the end of the 2014/15 marketing year were slightly larger than traders expected. The smallest soybean stocks in 10 years – 125 million bushels – will be available on Aug 31 when the new crop is ready for harvest, USDA estimated.
Analysts are focusing on two important reports due from USDA on June 30. One is the quarterly Grain Stocks report, which will gauge the size of the soybean stockpile going into the final three months before harvest. The other is the annual Acreage report, which updates USDA’s data on planting of major U.S. crops. It will give more precision to crop forecasts. Farmers said in March they would plant a record amount of soybeans while cutting back on corn.