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Biggest U.S. wheat buyer list changes

Agriculture.com Staff 01/23/2006 @ 9:00am

Because of less domestic demand, along with varying foreign wheat consumption and production factors, the export market is more important for U.S. wheat than for corn and soybeans. So far, in the 2005/2006 marketing year that ends May 31, the U.S. is experiencing some positive export success stories, according to industry experts.

By comparison, the U.S. exports 20% of its corn production, 33% of its soybean crop, and 40%-45% of its average annual wheat output of 2.035 billion bushels. The wheat class with the largest amount of exports is hard red winter, followed by hard red spring, white, soft red winter, and then durum.

In January, the USDA estimated U.S. wheat exports for 2005/2006 to total 1.0 billion bushel. With two noticeable success export stories, most analysts are comfortable with the USDA's export estimate.

The country of Nigeria has quickly risen to be the biggest buyer of U.S. wheat with almost all of it being hard red winter hard red winter wheat.

"They (Nigeria) have nearly doubled the amount they buy from the U.S. in just the last two to three years," Mike Krueger, World Prospectives, Inc., said.

Dawn Forsythe, U.S. Wheat Associates spokesperson, said Iraq is another success story for the U.S. wheat industry. After being completely shut out of the market during Saddam Hussein's regime, the U.S. has sold more than 2.0 million metric tons to Iraq this marketing year as of January.

"These are more sales made in Iraq than any year, even before Saddam took control," Forsythe said. "So, a lot of work has been done in Iraq , and it's benefiting U.S. wheat farmers."

For the 2005/2006 marketing year, the top five buyers of U.S. wheat with one million-plus purchase amounts include: Nigeria, Japan, Iraq, Mexico, and the Philippines.

Meanwhile, after losing 83% of sales compared to last year, the U.S. hopes to recover market share in China in the future, Forsythe said.

"China is buying less because their domestic wheat production was good this year. Plus, they bought so much 18-months prior to this marketing year that they are just working through those stocks," Forsythe said.

Krueger agreed that China is still a key export market for U.S. wheat. "A year ago China bought a lot of wheat for the first time in 10-15 years. This year, they have not bought nearly as much wheat as last year, but it looks like in the future they will be a consistent buyer," Krueger said.

Because of less domestic demand, along with varying foreign wheat consumption and production factors, the export market is more important for U.S. wheat than for corn and soybeans. So far, in the 2005/2006 marketing year that ends May 31, the U.S. is experiencing some positive export success stories, according to industry experts.

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