What is in this article?:
• Prospects for high net returns and crop insurance revenue coverage support combined 2013 area for wheat, corn, and soybeans very near last year’s 30-year high.
Other factors involved
Other factors that are expected to result in higher soybean plantings include reduced cotton area in the Mississippi Delta region and reduced Conservation Reserve Program acres in upper Midwest states, especially North Dakota.
Total 2013 rice planted acreage is projected at 2.64 million acres, down 2 percent from 2012. The majority of this year’s acreage decline occurs in long-grain rice in the Delta states, where producers are expected to switch to crops that earn a higher return, such as soybeans.
In contrast, medium-grain rice plantings are expected to expand due largely to expected higher prices.
Wheat supply, demand, and price outlook for 2013/14
Wheat Supplies: Wheat production for 2013 is expected to decrease more than 7 percent to 2,100 million bushels despite increased planted area. The year-over-year reduction stems from a lower yield and a lower harvested-to-planted ratio. Harvested area for 2013 is projected at 46.5 million acres, down 2.5 million acres from the previous year. The projected harvested-to-planted ratio is 0.83, down from 0.88 in 2012 and a five-year-average of 0.87.
The sharp reduction in harvested area is due the continuation of drought this past fall and winter in the HRW wheat area. Spring rains will be especially important in these areas of the Great Plains. The 2013 all-wheat yield is projected at 45.2 bushels per acre based on the 1985-2012 all-wheat simple linear yield trend. This would be down from a record 46.3 bushels per acre in both 2010 and 2012.
Increased area for higher-yielding SRW wheat and higher HRW abandonment continue to support expectations for trend yields.
Winter wheat conditions are substantially worse in the Great Plains compared with last year at this time. Conditions are particularly poor in the western parts of the affected states. Weighted by seeded area, the HRW states of Kansas, Nebraska, and Oklahoma have 50 percent of their crop rated in poor or very poor condition, compared to just 10 percent at this time last year.
These same states have 14 percent of their crop rated good or excellent, compared to 52 percent last year at this time. The SRW crop is in much better shape. As an indication of SRW conditions, 67 percent of Illinois winter wheat is in good to excellent condition; however, this is compared to 75 percent last year.
By-class 2013 production is expected to decrease for HRW wheat, other spring wheat, WW wheat, and Durum. These decreases are partially offset by higher expected SRW production. HRW wheat plantings are down 2 percent this year and the drought is expected to lead to increased abandonment.
With yields projected lower on the year, HRW production is expected to decline in 2013. Other spring wheat acreage is expected to increase slightly in 2013; however, production effects will be offset by a return to more normal yields. Durum yield and area are expected to be lower in 2013. WW wheat planted area is projected to decline 2 percent from the previous year. SRW wheat planted area is up 16 percent from the previous year with increased production expected in every major region.
The smaller wheat crop and lower beginning stocks are projected to reduce 2013/14 total wheat supplies 7 percent to 2,921 million bushels. If realized, these would be the lowest supplies since the 2007/08 marketing year.
Wheat domestic use: Domestic use of wheat for 2013/14 is expected to decrease 68 million bushels year to year. Food use is expected up 8 million bushels from the 2012/13 forecast. The projected 958 million bushels for food use for 2013/14 assumes a U.S. population growth rate of less than 1 percent, stable per capita flour consumption, and a slight decline in the flour-extraction rate from the very high levels of recent years.
Seed use for 2013/14 is projected down slightly year to year to 74 million bushels with a smaller planted area expected for the 2014 crop.
Wheat feed and residual use for 2013/14 is projected at 300 million bushels, down 75 million bushels from the 2012/13 projection. This decrease reflects an expected larger corn crop with normal weather and yields, a smaller HRW wheat crop, and a less favorable wheat/corn price relationship for wheat feeding in 2013/14 than in 2012/13. Much of the 2013/14 wheat feeding is expected during the summer quarter (June-August) as old-crop corn supplies remain extremely tight ahead of harvest.
Wheat exports: U.S. wheat exports for 2013/14 are expected to drop 100 million bushels from the 2012/13 forecast to 950 million with tighter supplies and intensified competition from other major exporters.