On Monday, July 12, USDA released its latest supply and demand estimates at 11 a.m. CDT.
WHEAT: The outlook for 2021/22 U.S. wheat this month is for reduced supplies, lower domestic use
and exports, and decreased ending stocks. Supplies are lowered on reduced wheat production and
beginning stocks. All wheat production is lowered 152 million bushels to 1,746 million. The all wheat
yield is 45.8 bushels per acre, down 4.9 bushels from last month. The NASS July Crop Production
report provides survey-based production forecasts for all wheat classes for the first time in the
2021/22 crop year. The production forecasts for durum and other spring wheat indicated a significant
decline compared to last year for these two classes due to the severe drought conditions affecting the
Northern Plains. Partially offsetting this decrease is higher winter wheat production, both on
increased harvested acreage and a higher yield. Imports are raised 20 million bushels to 145 million.
Beginning stocks are reduced on the latest NASS Grain Stocks report, which indicated lower
2020/2021 ending stocks than previously estimated.
Projected exports and feed and residual usage are lowered to 875 and 170 million bushels,
respectively, on the reduction in durum and other spring wheat supplies. These would be the
smallest U.S. wheat exports since the 2015/16 marketing year. Projected 2021/22 ending stocks are
reduced 105 million bushels to 665 million and are the lowest since 2013/14. The projected 2021/22
season-average farm price is raised $0.10 per bushel to $6.60.
The global wheat outlook for 2021/22 is for reduced supplies, fractionally lower consumption,
increased trade, and lower ending stocks. Supplies are projected to decline 5.3 million tons to
1,082.6 million on reduced beginning stocks in several countries and lower U.S. production not
offsetting higher foreign production. Global production is lowered 2.0 million tons to 792.4 million but
still remains at a record. Australia’s production is raised 1.5 million tons to 28.5 million, based on
continued widespread precipitation benefiting emergence and crop establishment. Russia’s
production is lowered 1.0 million tons to 85.0 million. Winter wheat production is reduced 0.5 million
tons to 64.0 million on decreased harvested area from a damaging early spring freeze more than
offsetting higher yields on continued favorable conditions across Western Russia. Spring wheat is
also lowered 0.5 million tons to 21.0 million on reduced yields with hot and dry conditions affecting
the spring wheat region of Central Russia. Kazakhstan is lowered 1.0 million tons to 13.0 million on
similar unfavorable conditions. The EU and United Kingdom are increased a combined 1.4 million
tons to 138.2 and 14.8 million, respectively on continued favorable conditions across Northern and
Central Europe.
Projected 2021/22 world consumption is fractionally lower at 790.9 million on lower feed and residual
use in Russia, the United States, and Kazakhstan mostly being offset by higher food, seed, and
industrial use in several countries. Projected 2021/22 global trade is raised 0.8 million tons to a
record 204.0 million, on increased exports by the EU, Ukraine, and Australia offsetting reductions in
Canada, Kazakhstan, and the United States. Projected 2021/22 world ending stocks are lowered 5.1
million tons to 291.7 million but remain above last year.
COARSE GRAINS: This month’s 2021/22 U.S. corn outlook is for larger supplies, greater feed and
residual use, increased exports, and higher ending stocks. Corn beginning stocks are lowered 25
million bushels, based on greater feed and residual use for 2020/21 as indicated in the June 30 Grain
Stocks report.
Corn production for 2021/22 is forecast 175 million bushels higher based on greater planted and harvested area from the June 30 Acreage report. The national average corn yield is
unchanged at 179.5 bushels per acre. During June, harvested-area weighted precipitation for the
major corn producing states was below normal but did not represent an extreme deviation from the
1988 to 2020 average. For much of the crop the critical pollination period will be during middle and
late July and USDA will provide its first survey-based corn yield forecast of the season in the August
12 Crop Production report.
Total U.S. corn use for 2021/22 is forecast 75 million bushels higher with increases for feed and
residual use and exports. Feed and residual use is raised reflecting a larger crop. Corn exports are
raised 50 million bushels, with sharply lower exports expected for Brazil. With supply rising more
than use, ending stocks are up 75 million bushels. The season-average farm price received by
producers is lowered 10 cents to $5.60 per bushel.
This month’s 2021/22 foreign coarse grain outlook is for lower production and use, larger trade, and
smaller stocks relative to last month. Foreign corn production is higher, with a projected increase for
Russia based on higher indicated area. Barley production is raised for Australia but lowered for
Canada, the EU, Russia, Kazakhstan, and India. For 2020/21, foreign corn production is lowered,
with reductions for Brazil and Paraguay more than offsetting an increase for Argentina. Major global
trade changes for 2021/22 include larger corn exports for the United States and Russia with a
reduction for Mexico. Corn imports are lowered for the EU and Iran. For 2020/21, corn exports are
raised for Argentina but lowered for Brazil for the local marketing year beginning March 2021.
Foreign corn ending stocks for 2021/22 are virtually unchanged from last month.
OILSEEDS: U.S. oilseed production for 2021/22 is projected at 130.5 million tons, up 0.2 million
from last month, with increases for sunflowerseed, peanuts, and cottonseed partly offset with a
reduction for canola. Soybean production is projected at 4.4 billion bushels, unchanged from last
month. Harvested area, forecast at 86.7 million acres in the June 30 Acreage report, is unchanged from last month but up 4.4 million from last year.
The soybean yield forecast is unchanged at 50.8 bushels per acre. Soybean supply and use forecasts are unchanged from last month.
Soybean changes for 2020/21 include lower imports, crush, and exports. With offsetting changes in
supply and use, ending stocks are unchanged at 135 million bushels. The U.S. season-average
soybean price for 2020/21 is forecast at $11.05 per bushel, down $0.20 as early-season sales at
lower prices continue to weigh on the season-average forecast. The soybean meal price is projected
at $395.00 per short ton, down $10.00 from last month. The soybean oil price is forecast at 57.5
cents per pound, down 1.5 cents.
The 2021/22 global oilseed supply and demand forecasts include higher production, exports, crush,
and ending stocks compared to last month. Global oilseed production is raised 2.5 million tons to
635.4 million, with higher sunflowerseed, rapeseed, cottonseed, and peanuts partly offset by lower
soybean output. Russian sunflowerseed production is increased 2.0 million tons to 16.5 million,
mainly on higher area shown in government planting progress reports. Australian rapeseed
production is raised on beneficial early-season rainfall and higher area. Canadian canola production
is lowered as early-season drought conditions impact yields and offset an increase to area.
Canada’s soybean production is also lowered based on lower area.
LIVESTOCK, POULTRY, AND DAIRY: The forecast for 2021 red meat and poultry production is
lowered from last month on lower pork, broiler, and turkey forecasts. The beef production forecast is
unchanged as higher slaughter is offset by lower expected carcass weights. Pork production is
reduced on lower expected second-half commercial hog slaughter. Broiler and turkey production are
lowered on the pace of production in the second quarter. However, the forecasts for the remainder of
the year are unchanged. The egg production forecast is lowered from last month on recent
production and flock data.
For 2022, the red meat and poultry production forecast is lowered, primarily on lower pork production
as well as slightly lower beef production. USDA’s Quarterly Hogs and Pigs report indicated
producers expect to farrow fewer sows in the second half of 2021 which, when coupled with slower
forecast growth in pigs per litter, will tighten supplies of market-ready hogs in 2022 relative to last
month. USDA will release the Cattle report on July 23, which will provide an indication of the midyear inventory and producer intentions for heifer retention. Broiler, turkey, and egg forecasts are
unchanged from last month.
Beef import forecasts for 2021 and 2022 are unchanged from last month while the export forecasts
are raised for both years on continued firm demand in Asia. Pork import and export forecasts for
2021 and 2022 are unchanged. Broiler exports for 2021 are raised primarily on higher-than-expected
May data, but no change is made to the forecasts for 2022. The turkey export forecast is raised
slightly for 2021 on current trade data; the forecast for 2022 is unchanged.
Cattle price forecasts for 2021 are raised on the strength of recent prices; no change is made to the
annual 2022 price. The 2021 hog price forecast is reduced on current price weakness, but the price
forecast for 2022 is unchanged as tighter supplies during the year, relative to last month, are
expected to help support prices. The broiler price forecast for 2021 is raised on slightly higher
expected third-quarter prices; no change is made to the 2022 broiler price. Turkey price forecasts for
2021 and 2022 are raised on improving demand. The 2021 and 2022 egg price forecasts are
reduced on current price weakness.
Milk production forecast for 2021 is lowered from last month as slower-expected growth in milk per
cow more than offsets higher forecast cow numbers. However, the 2022 milk production forecast is
raised from last month on higher cow numbers. USDA’s Cattle report, to be released on July 23rd,
will provide a mid-year estimate of the dairy cow inventory and producer intentions regarding
retention of heifers for dairy cow replacement.
Imports on both fat and skim-solids bases are raised for 2021 and 2022 on stronger expected imports
of cheese and butterfat containing products. Exports on a skim-solids basis are also raised for 2021
and 2022, reflecting stronger exports of whey, skim/nonfat dry milk powder, and lactose. Fat basis
exports are unchanged from last month.
For 2021, cheese, butter, nonfat dry milk (NDM), and whey price forecasts are lowered from last
month on relatively high stocks and weaker-than-previously-expected demand. As a result, Class III
and Class IV prices are lowered. The 2021 all milk price forecast is lowered to $18.30 per cwt. For
2022, price forecasts for cheese and butter are lowered on larger expected stocks and higher
production, but price forecasts for NDM and whey are unchanged. With lower cheese and butter
prices, Class III and Class IV price forecasts are reduced and the 2022 all milk price forecast is
lowered to $18.50 per cwt.
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