OSU’s Kim Anderson Suggests US Poised to Recapture Lost Share in the Global Wheat MarketMon, 20 Aug 2018 15:59:41 CDT
When you look at the five-year average world wheat production, Dr. Kim Anderson, emeritus grain marketing specialist at Oklahoma State University, says the United States and the Former Soviet Union (FSU) are moving in lockstep.
“Since the Hard-Red Winter crop is essentially harvested, I think the strength of our price is coming from the export market,” Anderson said. “And, I think probably Russia is the major player in impacting that price.”
Between 2004 and 2008, the U.S. five-year average wheat production was 2.126 billion bushels (bb), nine percent of the world’s production. During the same time, the FSU average wheat production was 3.445 bb, 15 percent of the world’s production. By 2014 - 2018, the U.S. average wheat production was down two percent (2.004 bb, seven percent of the world’s production) and the FSU average wheat production was up two percent (4.584, 17 percent of the world’s production).
Russia is also growing as a major exporting country for wheat and the United States’ wheat exports are shrinking. From 2004 to 2008, Russia exported 11 percent of the world’s wheat, 0.441 bb, while the U.S. exported 26 percent, 1.051 bb. From 2014 to 2018, Russia increased to 18 percent, 1.111 percent, while the U.S. decreased to 15 percent, 0.914.
But Anderson said the situation is not permanent. The world has an adequate supply of wheat but that supply is shrinking. When it does, the United States is poised to recapture market share.
“I think we remain competitive by providing a quality product,” he said. “When we get into the harvest of 2019, the US and the world is going to need wheat that’s got 60 lb. test and better than 12 percent protein. If we have a quality product, we’re going to be competitive in our major markets. That’s Mexico, that’s the Philippines and the Pacific Rim countries and into Japan and Korea to a certain degree.”
Don Atkinson with WheatSquared.com has more in this interview with Dr. Kim Anderson. Click or tap the LISTEN BAR below to hear their complete conversation.
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