In our overall update on the WASDE (see here), I wrote about the major changes in global wheat production. In that piece, I didn’t talk about stocks, which are equally as important as production.
The global wheat ending stocks are set to fall this year to 279mmt, the lowest level since 2016. It is important to look further into the data at the exporters.
The global grain trade is dominated by eight major exporters*. Therefore they are of paramount importance to what is available to import nations. The ending stocks for the exporters is forecast at 50.1mmt. This is the lowest level since 2007.
The ending stocks to usage ratio is a handy indicator (explanation here). The end stocks to usage ratio have dropped dramatically since the start of the year (see here). The global stocks to use ratio is at its lowest level since 2016. More importantly, the export nations are at the lowest level since 2012.
The summary is that globally available stocks are declining, and that is good news for Australia at a time when we are going to have a big crop.
*Argentina, Australia, Canada, EU, Kazakhstan, Russia, Ukraine, USA.