WHEAT YEARBOOK-- SUMMARY                                 March 26, 2002
March 2002, ERS-WHS-2002
            Approved by the World Agricultural Outlook Board
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This SUMMARY is published by the Economic Research Service, U.S. Department 
of Agriculture, Washington, DC 20036-5831.  The complete text of WHEAT YEARBOOK
(WHS-2002) will be available electronically about 2 weeks following this 
summary release. 
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Wheat Supplies Drop; Demand Weak
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The Wheat Yearbook presents preliminary projections for 2002/03 that were 
released at the 2002 Agricultural Outlook Forum on February 22, 2002.

U.S. wheat supplies for 2001/02 are expected to drop 343 million bushels from a 
year ago to 2,929 million bushels. Total disappearance is forecast to drop 168 
million bushels from 2000/01, the result of lower exports and feed and 
residual. Use will exceed production, and stocks are forecast down 175 million 
bushels from 2000/01. The season-average farm price is projected to range 
between $2.75 and $2.85 per bushel, up from $2.62 a year earlier.

Winter wheat plantings for the 2002 crop are down slightly from a year earlier 
and the lowest since 1971. Durum prospects are somewhat better than most other 
classes of wheat as a result of a shortfall in 2001's production in Canada and 
the United States. This has increased prices of milling-quality durum and 
should promote increased plantings. Spring wheat acreage will continue to face 
strong competition from oilseeds in 2002 and greater competition from barley in 
some areas, given tight supplies of malting barley in the United States and 
Canada. The projected 2002 harvested area is increased by 900,000 acres from 
last year, assuming a 3-year average harvested-to-planted ratio by State.

Total wheat production for 2002/03 (June/May) is projected to increase 92 
million bushels from a year earlier, assuming an average yield of 41.3 bushels 
per acre, based on 1999-2001 average yields by State. However, the higher 
production will be more than offset by reduced beginning stocks. Total use is 
projected down 90 million bushels as exports drop to their lowest level in 30 
years. Prices are projected down from the midpoint of the 2001/02 price range 
to $2.75 per bushel.

Winter wheat in the Northern Hemisphere has been planted, and area in several 
of the largest producing regions has increased. Moreover, the area increases 
are large enough so that unless yields drop dramatically, global wheat 
production will increase in 2002/03. To date, foreign producers have had 
generally favorable weather. However, in some countries that had excellent 
yields in 2001/02, yield declines in 2002/03 are likely. Global supplies will 
rise if production gains exceed the 10-million-ton drop in beginning stocks. 
World wheat use is likely to grow slowly, with most of the increase driven by 
population growth supporting human consumption. However, with increasing wheat 
supplies in the European Union, and possibly lower prices compared with other 
grains, increased wheat feeding can be expected in 2002/03.

Printed copies of the Wheat Yearbook will be available in several weeks. For 
further information, contact Gary Vocke (202) 694-5285. This issue contains 
three special articles: "Economic Analysis of Ending the Issuance of Karnal 
Bunt Phytosanitary Wheat Export Certificates," "Wheat Production Costs Vary 
Across the United States," and "International Wheat Breeding and Future Wheat 
Productivity in Developing Countries." The full report will also be available 
on the ERS web site at http://www.ers.usda.gov/briefing/wheat/.


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