April 11, 2007

USDA cuts US 2006/07 wheat ending stocks forecast; sees more exports

US wheat ending stocks for the 2006/07 marketing year will be 50 million bushels lower than expected just a month ago, while feed use and exports are projected to be higher, the US Department of Agriculture said Tuesday (Apr 10).

The USDA, in its monthly supply and demand report, predicted wheat ending stocks will total 422 million bushels, a drop from last month's forecast for 472 million bushels.

The 2006/07 carryout reduction was widely expected by market analysts surveyed by Dow Jones Newswires prior to the release of the USDA's report. Whereas higher corn prices reduced livestock feed demand for that commodity, wheat was in higher demand, they said.

The USDA agreed in its monthly report.

"Feed and residual use is raised 25 million bushels as the March 1 stocks indicated higher-than-expected use in the December-February quarter," the USDA said about wheat demand.

The new "feed and residual" use forecast is for 170 million bushels, up from the March forecast of 145 million bushels. US wheat exports, the USDA said, are now predicted to reach 900 million bushels, up from 875 million bushels.