In W28 in the wheat landscape, the Food and Agriculture Organization (FAO) raised 2023 global wheat production by 0.9% to 783.3 million metric tons (mmt), 18.4 mmt lower than in 2022. The wheat production forecasts for the European Union (EU), Canada, Kazakhstan, and Turkey were also revised upwards due to favorable weather and increased sowing areas. Although there has been a sharp drop in wheat production in Australia due to dry weather forecasts, higher production in other regions compensates for the decline. Global wheat stocks currently amount to 314 mmt, a 0.9% increase compared to the initial 2023/24 forecast. Global wheat stock estimates were raised by 5.5 mmt in Jul-23, primarily for China, the EU, and Kazakhstan. Further, the FAO raised the 2023/24 global wheat trade by 1.6 mmt to 195 mmt, primarily driven by anticipated increased sales in Canada and higher wheat imports by China.
The United States Department of Agriculture (USDA) reports that in the week ending July 6, United States (US) wheat export inspections reached 419.13 thousand metric tons (mt), an increase of 76.96 thousand mt week-on-week (WoW) and 109.13 thousand mt year-on-year (YoY). US wheat shipments were primarily destined for the Philippines and Colombia. Just over a month into the 2023/24 season, US wheat inspections are 1.52 mmt, down compared to 1.92 mmt in the same period in 2022/23. As of July 3 in France, soft wheat harvesting reached 10% of the planned area, a 9% WoW increase. French hard wheat harvesting also reached 26% of the area, a 21% WoW increase. However, the harvesting rates for both soft and durum wheat are trailing behind 2022's levels, which registered 13% and 46% of the crops threshed in the same period. Nevertheless, the current rates are still better than the five-year average, which stood at 7% for soft wheat and 23% for durum wheat. Also, 81% of French soft wheat and 70% of durum wheat crops were rated excellent or good.
Lastly, according to Rusagrotrans, wheat prices registered significant strength in both sea and river ports in Russia over W27. Wheat prices (4th grade, 12.5% protein) in deep-sea ports reached USD 174.32-176.52/mt without value addition tax (VAT), while in low-water ports, prices reached USD 159.97/mt. This increase can be attributed to the sharp weakening of the Russian Ruble against the US Dollar by over 6% and represents a notable increase compared to 2022's prices. The Russian domestic wheat market also strengthened in most regions, except Siberia, where prices remained unchanged. Dry and hot weather conditions in the south of the Volga region, Urals, and Siberia are expected to negatively impact wheat yields, potentially affecting harvest schedules and grain quality. Export demand prices for Russian wheat with 12.5% protein for July delivery remained stable at USD 230-235/mt Free On Board (FOB). The export duty on wheat for the period July 12 to July 18 increased to USD 32.98/mt, up USD 4.19 WoW.
