The USDA projects U.S. wheat prices will hover at about $6 per bushel over the next 10 years, given a stable world market with no crop problems. “That almost never happens, but it’s an important baseline to think about,” said Randy Fortenbery, Washington State University’s Thomas B. Mick Endowed Chair in Small Grains Economics. A farmer might ask, “What was the price last year and how come I’m getting $2 less a bushel?”

For wheat, the estimates show that a smaller crop outweighs heavier carry-in stocks and increased imports. Combined with a rise in domestic consumption, this leaves a tighter balance this season. A key takeaway from this month’s estimates, is a rise in wheat, maize and oat imports from last season. For wheat and oats, this is largely due to the lower quality of the domestic crops harvested in 2023, resulting in the need to import higher quality grain for milling purposes.

Canadian wheat exporters are facing a new competitor in their second biggest market. “The rapid emergence of Brazil as an exporter in Indonesia and other foreign markets has been remarkable,” the U.S. Department of Agriculture said in its recent Grain: World Markets and Trade report. Indonesia bought 2.14 million tonnes of bulk wheat from Canada in 2022-23. It was Canada’s second largest customer that year behind China’s 2.97 million tonnes, according to the Canadian Grain Commission. Canada faces stiff competition in that market, primarily from Australia, which is the top supplier of wheat to Indonesia.

It's no secret that U.S. wheat prices are in a slump. I'm not here to bemoan the fact, but I do think it has become an interesting situation that deserves watching. For starters, March KC wheat closed at $6.24 1/4 Wednesday, Nov. 22, near its lowest March price in over two years. DTN's National Hard Red Winter (HRW) Wheat Index closed at $5.52 per bushel the same day, a price that, before this year, was last seen in early 2021.

The United Nations World Food Programme (WFP) warned on Tuesday that Ukraine's wheat production may be unable to meet domestic and export demand in the years to come if Black Sea export routes remain blocked and attacks on food infrastructure continue…"If attacks on food infrastructure and the blockage of sea export routes continue, it will dramatically impact the agricultural production outlook over years to come, and may, in a worst-case scenario, lead to wheat production being unable to meet domestic and export demand," Hollingworth said.

USDA took a key step Thursday in rolling out its new $1.3 billion international marketing initiative, the Regional Agricultural Promotion Program, and unveiled plans for trade missions next year to Vietnam, India, South Korea, Canada, Colombia and Morocco. USDA posted a final rule for operating RAPP, which will be funded out of the department's Commodity Credit Corporation account. Commodity groups still need to know how much money is available over what time frame and which foreign countries are eligible as targets for the promotion campaigns.

Join UI Extension for the 2023 Idaho Ag Market Outlook Seminar Series. The series aims to provide businesses and individuals in agriculture with an update on the current status of Idaho's major agricultural commodities and provides insights on what to expect in the coming year. The series will be held at four locations across the state. Topics will include Global/Macro Trends, Weather, Grains, Beef, Dairy, Input Costs and more.