In W43 in the wheat landscape, world wheat production for the 2023/24 marketing year (MY) is projected to reach 784.9 million metric tons (mmt), the second-highest in history, down from 803.4 mmt in 2022/23 MY. Notably, the wheat production forecasts have been adjusted, with increases in Russian to 89 mmt, Ukraine to 27.4 mmt, and the United States (US) to 49.3 mmt. In contrast, Argentina's forecast was reduced to 15.6 mmt, Australia's to 24.4 mmt, and Kazakhstan's to 12.5 mmt due to adverse weather conditions, including a summer drought and excessive autumn precipitation.
The global wheat export forecast was raised to 196.6 mmt, with increased estimates for Russia at 49.1 mmt, Ukraine at 12.5 mmt, and the US at 19.6 mmt. In contrast, the Argentinian wheat export estimate was reduced to 10.9 mmt, Australia's to 18 mmt, and the European Union's (EU) to 36.1 mmt. World wheat stocks for 2023/24 MY are expected to remain at 262.6 mmt, down from 281.5 mmt in the previous year.
China's largest wheat-producing region is expected to experience heavy rains in the next ten days, potentially affecting wheat sowing and other crops. Western Henan Province may receive moderate to heavy rains, leading to excess soil moisture that could hinder crop planting. Increased rainfall in the northwest and southwest regions could also disrupt local corn harvests and wheat planting. China has been increasing efforts to purchase high-quality wheat from the global market to meet domestic demand.
The United States Department of Agriculture (USDA) reported that US net wheat sales for the week ending October 12 reached 663 thousand mt, slightly higher than the 650 thousand mt from the previous week. China was the leading buyer, purchasing 182 thousand mt.
Meanwhile, Russia is expected to supply around 80 thousand mt of wheat to China from Jul-23 to Oct-23, with total exports potentially reaching 200 thousand mt for the agricultural year spanning Jul-23 to Jun-24. In the first nine months of 2023, China imported 10.2 mmt of wheat, which is more than 1.5 times higher than the 6.6 mmt imported for the same period in 2022.
From October 1 to October 20, Russia exported 3.48 mmt of wheat, marking a 12.2% YoY decrease. The leading buyers of Russian wheat, Turkey and Egypt, reduced their purchases in Oct-23, with shipments to Turkey decreasing by 40% YoY to 435 thousand mt and to Egypt by 55% to 424 thousand mt. In third place is Bangladesh, where 276 thousand mt of wheat were sent, representing a 38% YoY decrease.
The Russian wheat export duty is set to decrease to USD 56.92/mt for the period spanning from October 25 to 31, 2023, down from the existing rate of USD 61.61/mt. Russia resumed wheat supplies to Indonesia, interrupted in 2022. As a result, in the first nine months alone, the volume of exports already exceeded 500 thousand mt. Russia currently provides almost 25% of the global wheat supply, and on the other hand, Indonesia is one of the largest grain importers in the global market.
Lastly, the Indian government has raised the minimum support price (MSP) for wheat used in sowing by 7.1%, setting it at USD 27.33 per quintal. This increase is the highest growth rate in the last ten years. Additionally, the final estimate for the 2022/23 season's wheat production was lowered to 110.55 mmt.