June WASDE Shows US Will Import More Oats in 2017/18

The June WASDE report showed that the US will import more oats in 2018. Also, the price range for oats was increased by 5¢, a slightly bullish indicator.

On Tuesday, the USDA released the June WASDE report, which offered a few key updates to the global oats crop. Here’s our breakdown of the numbers.

The USDA’s June WASDE report showed the market that American farmers will produce 66 million bushels of oats in 2018/19. This figure was the same as what the USDA reported in May 2018.

Compared to the five-year average of 70 million bushels, 2018/19 American oats production is 6% lower.

Oats Production US

From a supply and demand sheet perspective, we can just look at ending stocks to get an idea of where we sit.

For American oats, 2018/19 carryout is expected to come in at 29 million bushels. This figure was increased by 3 million bushels month-over-month. While USDA left the 2018/19 balance sheet unchanged, we need to point out that the USDA penciled in some minor changes to the 2017/18 US oats balance sheet.

In particular, USDA raised 2017/18 US ending stocks by 3 million month-over-month to 90 million in June. This was passed along the 2017/18 US oats balance sheet so that ending stocks were raised 3 million month-over-month to 24 million bushels in May.

On the pricing front though (for new crop oats prices), USDA increased their range from the May report by 5¢ USD to the new range of $2.60 to $3.20 US per bushel ($3.35 to $4.15 CAD per bushel). This is a bullish development for Canadian oats producers as the US is the main export destination for oats produced in Canada.

Looking more globally, oats production is expected to climb 147,000 tonnes or 1% year-over-year to 23.6 million tonnes. That could be viewed as slightly bearish.

From a global carryout perspective, 2018/19 is forecasted by the USDA to end with 2.6 million tonnes. This is up 6% year-over-year.

A few other key points from the report:

A slightly bigger world oats production and heftier ending stocks in 2018/19 could be viewed as bearish developments.

A faster than anticipated US oats import pace in 2017/18 is a bullish development for oats producer in Canada. Seen in conjunction with stronger new crop US oats prices, the outlook for Canadian oats turns slightly bullish.

To get a view of all the major numbers in today’s June 2018 WASDE report, check out the table below and read our live update on the FarmLead Insights page.

WASDE June report numbers

About the Author
Adrian Uzea

Hailing from a farm in Romania’s breadbasket, Adrian’s keen interest in agriculture inspired him to obtain a Master's degree in Ag Economics from the University of Saskatchewan. Adrian provides deep, original insight for Canadian farmers of grains, oilseeds, and other specialty crops to help improve their bottom line. He was previously a Market Analyst with a provider of grain marketing services like DePutter Publishing.