Posted April 22, 2021
Kansas farmers have good reason to say “gracias” for continued wheat purchasing by their closest market — Mexico. Mexico dominated imports of U.S. hard red winter (HRW) wheat in March 2021, according to the latest data available from the U.S. Department of Agriculture (USDA). As the top importer for the month, Mexico purchased nearly 6.39 million bushels (roughly 174,00 metric tons), compared to no markets above the 100,000-metric ton (3.67 million bushels) threshold in February.
Thanks to duty-free access established by the North American Free Trade Agreement (NAFTA) and solidified by the United States-Mexico-Canada Agreement (USMCA), Kansas elevators and Mexican flour mills have a highly interconnected supply chain. Combined with market development work by the Kansas Wheat Commission and U.S. Wheat Associates (USW), Mexico remains one of the largest destinations for Kansas HRW wheat each year.
“Our key customers in Mexico know they can rely on Kansas wheat farmers to produce consistent quality year-in and year-out,” said Aaron Harries, Kansas Wheat vice president of research and operations. “Maintaining trust with these top buyers requires continually sharing information on our wheat crop and providing technical support — information and expertise they do not receive from our competitors.”
Overall, the United States exported 19.7 million bushels (537,000 metric tons) of HRW in March, bringing the year-to-date total to more than 267 million bushels (7.28 million metric tons). While last month’s exports are more than 25 percent higher than the previous month, they lag nearly 36 percent behind March 2020.
Mexico represented the lion’s share of these exports, but 13 countries in all imported HRW in March, up from nine in February. Nigeria remained the second-largest importer for the month at 3.43 million bushels (93,400 metric tons). Japan rounded out the top three importers for March 2021 at 1.87 million bushels (nearly 51,000 metric tons).
Inspections of HRW at Gulf, Pacific and Interior ports increased 35 percent from February but remained 20 percent less than March 2020.
USDA, in its monthly World Agricultural Supply and Demand Estimates (WASDE) report, projected the United States will export 985 million bushels (26.8 million metric tons) of wheat this marketing year. Ten months into the year, the United States has exported 77 percent of that total, slightly behind the pace needed to hit the marketing year-end goal.
Kansas farmers can follow the exports of HRW wheat through a pair of reports from USW. USW provides both a weekly report on commercial sales and a visual rundown of the organization’s analysis of the WASDE report, along with many other online resources.
“Both of these reports are important aspects of the wheat trade to understand as both can have an impact on the wheat market through futures and basis movements,” Harries said.
The Kansas Wheat Commission is a member of USW, which combines funding from 19 state wheat commissions and cost-share grants from the USDA’s Foreign Agricultural Service (FAS). As the wheat industry’s export market development organization, USW promotes the reliability, quality and value of all six U.S. wheat classes to wheat buyers, millers, bakers, food processors and government officials in more than 100 countries around the world.
Follow USW’s reporting on worldwide supply and demand at https://www.uswheat.org/market-and-crop-information/supply-and-demand/ and weekly commercial sales at https://www.uswheat.org/market-and-crop-information/commercial-sales/.
Written by Julia Debes for Kansas Wheat