The US Department of Agriculture Oct. 9 bumped up Russia's 2020-21 wheat production estimates sharply from September projections, which is expected to increase global wheat supplies and ending stock levels.
Russia is expected to produce 83 million mt in 2020-21, up 6.4% from a previous estimate, making it the second-largest crop on record for the country, the USDA said in its World Agricultural Supply and Demand Estimates report released Oct. 9.
The surge in wheat production estimates brings USDA's projections in line with other Russian agencies, which are also around 83 million mt.
"The increased production is based on updated harvest results as reported by Russia's Ministry of Agriculture, which imply record-high spring wheat yields," the USDA said.
The agency expects Russia to ship 39 million mt of wheat in 2020-21 (July-June), eclipsing last three years' record.
Dry conditions pressure Ukraine, Argentina
Production estimates for Ukraine, another major wheat player in the Black Sea region, were cut by 1.5 million mt from a previous estimate, lowering the 2020-21 output to 25.5 million mt, according to the report.
Farmers in Ukraine faced difficult weather conditions during the growing season, which weighed on the production capacity.
Another country that has been going through a dry season, Argentina, has been facing similar situation where crop quality has been hit severely due to the weather conditions.
The USDA cut Argentina's 2020-21 wheat production estimates by 500,000 mt, to 19 million mt, citing "continued dry conditions in some regions."
Argentinian exports for 2020-21 (December-November) were revised down to 13 million mt from a previous estimate, setting the output levels below the 2019-20 season.
China imports revised up
The agency also raised China's 2020-21 (July-June) wheat import estimates by 7.1% from September, to 7.5 million mt, the highest volume expected in at least last five years.
This comes in the midst of China's buying spree of US wheat, with its 2020-21 commitments inching near to a four-year high. China has been also buying wheat in large volumes from Australia and France this year.
Between January and August, China has imported around 2.5 million mt of wheat from Australia and France, latest data from Beijing-based analytics firm Cofeed showed.
US output down
The USDA expects the US to produce 49.70 million mt of wheat in 2020-21 marketing season (June-May), down 1% from the September estimates.
The largest disappearance from the US wheat harvest is the Hard Red Winter wheat crop, dropping 22% from 2019-20 levels.
US 2020-21 ending stocks were revised down 4.5% from September, to 24.14 million mt, also below trade expectations.
US wheat exports in 2020-21 (June-May) are expected to hit 26.5 million mt, unchanged from the previous estimate.
Overall, the USDA raised world wheat ending stocks for the 2020-21 season to 321.5 million mt from 319.4 million mt estimated in September.
Global ending stocks were above average trade expectations of 317.2 million mt.
