With increased supplies of competing origin wheat and the end of Russia’s government-imposed export ban, U. S. commercial wheat sales for marketing year 2011/12 (June-May) have declined this year compared to last, according to the U. S. Department of Agriculture (USDA).
Purchases by Egypt that are running nearly 880 thousand metric ton (TMT) less than in 2010/11 account for more than the overall reduction in total sales in 2011/12 compared to 2010/11.
However, the global sales pace and forecast for the year remain above the five-year average, indicating continued value in a reliable supply of excellent quality U.S. wheat.
As of Aug. 18, 2011, sales totaled 11.1 million metric tons (MMT), down four percent from this time last year and one percent below the five-year average of 11.2 MMT.
Changes in regional sales vary widely; many region totals were affected by significant changes in exports to one country. In fact, several regions are purchasing more U.S. wheat this year compared to 2010/11.
With Black Sea wheat back on the market, Egypt has again diversified its sources compared to last year when Russia abandoned the world's largest buyer.
The Middle East/East Africa region’s U.S. wheat purchases of 1.17 MMT is 21 percent below last year’s pace.
Egypt shows largest reduction
Egypt accounted for the largest reduction in U.S. sales, dropping 78 percent to 247 TMT purchased to date.
Iraq has purchased 514 TMT of U.S. wheat following two years in which its imports shifted to other suppliers. That helps offset slightly the reduced Egyptian sales.
Excluding the significant change in Egyptian purchases, U.S. wheat sales to Middle East and East Africa nations to date are 39 percent greater than last year.
Total U.S. sales to date in the Americas are also below last year’s pace.
Sales to the Mexico, Central America and Caribbean region to date are 2.39 MMT. That pace is down compared to last year, but excluding Bermuda and Cuba, which have not yet purchased U.S. wheat, regional sales are up 12 percent year over year.
South American sales overall are down 353 TMT to 900 TMT, a 31 percent decrease.
Brazil, which traditionally buys the majority of its wheat from its Mercosur trading partner Argentina, has also purchased less U.S. wheat this year.
Europe and North Africa are other regions experiencing decreased U.S. commercial sales. However, Morocco recently announced it intends to purchase up to 300 TMT of U.S. durum wheat.
The 27-country European Union has purchased 283 TMT less U.S. wheat to date, partly reflecting caution with significantly higher world durum prices.
Several regions have increased commercial purchases compared to last year.
China’s purchases total 237 TMT, up significantly from 7.2 TMT in total U.S. wheat purchases last year and the five-year average of 31.7 TMT.
The rest of North Asia is five percent ahead of last year’s pace with sales of 2.43 MMT to date and above the five-year average of 2.0 MMT.
South Asia is 15 percent above last year’s sales level, with almost every country in the region purchasing more U.S. wheat this year.
Regional sales stand at 1.97 MMT, an increase of 260 TMT and 460 TMT above the five-year average.
Concern about the availability of high protein spring wheat from Canada and the United States this year may be accelerating wheat purchasing among spring wheat buyers in North and South Asia.
The Sub-Saharan Africa region is also ahead of last year’s sales and the five-year average. Sales of 1.58 MMT are a six percent increase from last year and 111 TMT above the five-year average. Higher sales in South Africa and Mozambique contributed to the sales growth.
The current commercial sales pace is on track to meet USDA’s projected 2011/12 total U.S. exports of 29.9 MMT. If realized, U.S. commercial sales would be 14.7 percent below last year’s sales of 35.1 MMT, which represented the largest demand for U.S. wheat in many years.
Visit www.uswheat.org/reports/commercialSales to view the commercial sales report, which contains a breakdown of countries by region and is updated using USDA data every week.