USDA regularly adjusts wheat supply and demand estimates for Southern Hemisphere exporters this time of year as their harvests progress.

So, it was unusual when the largest adjustment in December’s World Agricultural Supply and Demand Estimates, or WASDE, report was for Canada, where the wheat harvest ended almost two months ago.

USDA added 4.3 million metric tons (MMT) to last month’s Canadian production estimate to meet Statistics Canada’s official assessment of 37.5 MMT. If accurate, that would beat the previous record of 32.1 MMT, set in 1990/91, by a considerable margin.

The significant late-season adjustments to the production projections are partly the result of the first harvest without the Canadian Wheat Board monopoly, which previously controlled all wheat stocks.

Another effect of the monopoly’s dissolution is that Canadian farmers near the U.S. boarder now have the option to sell to U.S. elevators. This is particularly important this year as the Canadian spring wheat crop protein average is well below normal and can compete with a relatively high-priced U.S. hard red winter, or HRW, wheat.

As a result, USDA expects the United States to import a record 4.4 MMT of wheat in 2013/14, mostly from Canada, compared to the five-year average of 3.1 MMT.

A little known fact is that the United States has always been Canada’s top wheat export market and this year could account for nearly 17 percent of Canada’s expected 23.0 MMT in exports.

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In another small surprise from the December WASDE report, USDA left its Argentine production forecast unchanged at 11.0 MMT, despite an Argentinean agricultural ministry projection of 8.5 MMT. The decision might hint at USDA’s level of confidence in the official projection.

In November, the ministry said erroneous data collection led to an inaccurately low production forecast of 8.7 MMT. It did not release a correction and then lowered the estimate in December. Production of 11.0 MMT would be a 16 percent increase from last year’s 9.5 MMT but down from the five-year average of 13.0 MMT.