WESTERN PRODUCER — A consensus appears to be emerging about the size of Ukraine’s upcoming wheat crop.
The U.S. Department of Agriculture is forecasting a 2022-23 harvest of 21.5 million tonnes, down 35 percent from last year and 23 percent below the five-year average.
That is very much in line with a pre-USDA report estimate from French data analysis firm Kayrros, which is also forecasting 21 million tonnes of production.
Its forecast is based on an analysis of satellite imagery provided by NASA April 14-22.
“Given that the fighting is ongoing and that a large part of the country’s wheat production comes from areas of eastern Ukraine where the conflict is most intense, the real production figures are likely to be lower than the current crop cover might suggest,” the firm said in a recent press release.
The USDA is forecasting a 21 percent reduction in wheat harvested area and an 18 percent drop in yields in Ukraine.
It believes there will be a 30 percent destruction/abandonment rate in conflict zones.
“This percent includes areas that have been destroyed because Russians have mined fields, bombs that have left unworkable craters, debris in fields, and areas that will be abandoned due to lack of fuel or manpower,” the USDA stated in its World Agricultural Production report.
Satellite-based normalized difference vegetation index (NDVI) maps show that establishment conditions are below average due to dryness in October. However, spring conditions are more important in determining final yields.
Fertilizer use is expected to be similar to 2020 when farmers could not source inputs due to the COVID-19 pandemic. Yields fell dramatically that year.
“A similar drop in yield is expected for the current year because of ongoing issues sourcing inputs due to the invasion and the blockage of major ports in the Black Sea, which has disrupted supply chains,” said the USDA.
The wheat harvest in Ukraine runs from the end of June until Mid-August.
Ukraine’s small crop contributed to the forecast for 267 million tonnes of world wheat ending stocks for 2022-23.
“That is quite a bit less than what was expected,” DTN lead analyst Todd Hultman said in a webinar following the release of the USDA report.
That would be the lowest ending stocks in six years.
However, the picture becomes even more eyebrow-raising when analyzing the ending stocks of the world’s top-eight exporters of the crop.
That total is 48 million tonnes.
“That would be the lowest exportable supply in 15 years, so obviously a very bullish situation worldwide,” said Hultman.
Ukraine’s exports are forecast to plummet to 10 million tonnes in 2022-23, down from 19 million tonnes this crop year.
Hultman said the world was counting on India to pick up some of that slack but the USDA is forecasting 8.5 million tonnes of exports from that country, down from pre-report estimates of 10 million tonnes due to a late-season heatwave.
Russia’s wheat production is forecast at 80 million tonnes, up six percent from last year but well below private trade estimates of up to 87 million tonnes.
“Favorable moisture throughout April, as the crop has emerged from dormancy, has led to good early prospects, especially in the southern oblasts of European Russia,” said the USDA.
Crop yield will be highly dependent on May and June weather. Harvest begins in July.
Russia is forecast to export 39 million tonnes of wheat, up from 33 million tonnes this year.