Hard Wheat

The newest edition of the FEWS Net Monthly Price Watch was released last week, citing continuing high international maize and wheat prices. While maize prices saw drastic spikes in June and July 2012 due to drought conditions in the US, they leveled off, although at high levels, later in the year as more information regarding US crop conditions and global supplies became available. Wheat prices, on the other hand, rose steadily between May and November before leveling out in December.

The USDA's latest World Agricultural Supply and Demand Estimate has been released, predicting low global wheat and corn stocks for 2012/2013. Global wheat supplies are projected to be slightly lower due to reduced production prospects in Argentina and lower reported production in Russia. US corn ending stocks are projected to be 44 million bushels lower; higher US wheat disappearance will leave the balance sheet historically tight and is expected to support continued strong and volatile prices.

As one of the world's most important staple crops, wheat plays a crucial role in the global agricultural economy and in global food security. The grain accounts for an estimated 20 percent of calories consumed throughout the world. But a burgeoning global population and changing climate are putting ever greater pressure on wheat farmers to produce bigger yields. A new multinational initiative, the Wheat Yield Network, has recently been launched to help raise global wheat yields and develop new wheat varieties that are better adapted to meet the world's changing needs.

US wheat supplies are expected to increase by the end of 2013, in part because of weakened export demand, according to the latest Wheat Outlook from the USDA Economic Research Service. Global wheat production is also forecast to increase by 3.7 tons due to increases in China, Australia, and Canada. World ending stocks are predicted to be 2.8 million tons higher than previously estimated.

International export prices of wheat and maize remained stable but high in November , according to the latest GIEWS Global Food Price Monitor. International rice prices were somewhat mixed but generally lower than November 2011.