WASDE preview: Minor upward wheat stock revisions before May

With this month’s update from AMIS showing only minor revisions to global wheat supply and demand, the industry is expecting Tuesday’s global supply and demand report from the USDA to follow its lead.

On the US domestic front, average trade guesses, pooled by a Thomson Reuters survey, have ending stocks pegged at 1.036 billion bushels – a tiny increase from last month’s USDA figure of 1.034 billion bushels.

Equivalent to 28.2 million mt, analyst guesses had a notable wide range of almost 2 million mt between them, suggesting significantly differing opinions on the pace of US wheat exports over the remainder of the marketing year.

The latest export sales figures are at 18.9 million mt so far in 2017/18 – 10.3% down on the same stage last year, although the industry generally seems upbeat on the pace of exports to date.

At a global level, average analyst expectations for end stocks are 730,000 mt below last month’s estimate from the USDA at 268.16 million mt.

And while most are expecting this to be another calm report with amendments only an academic exercise ahead of May’s forward-looking release, there are global dynamics which may have caught the USDA’s eye.

Russia’s annual exports were pegged at 37.5 million mt in the March report, but the current pace of loadings could see wheat exports, on a July-June marketing year basis, approach the 40 million mt mark.

Any adjustment to exports would have to see carryover amended accordingly.

On the other side, EU wheat exports would also need to be revised downwards and carryover stocks increased on the back of its current trajectory.

Having been put at 25 million mt last month, the latest EU figures come to just 14.1 million mt of exports so far this season.

With loadings averaging less than 370,000 mt a week since the start of the marketing year, it seems unlikely that the EU will be able to get this balance to market, which would also likely require an upward revision of its 14.12 million mt ending stocks.

And elsewhere, warm weather concerns over Pakistan’s coming crop may see sellers hold back on exports, while in India the USDA’s local office stuck an extra 300,000 mt on to its import forecast at the end of March.