U.S. Wheat Trade
Although the United States produces only 10 percent of world wheat (1993/94-2007/08 average), it is consistently the world's biggest wheat exporter.
Since the early 1960s, U.S. wheat exports have fluctuated sharply. The trend was upward until 1981/82 (the international trade year for wheat is July-June), when exports reached a high of over 48 million metric tons, but then reversed, with exports falling to less than 23 million metric tons in 2002/03. The U.S. share of world wheat exports has fluctuated from a high of 50 percent in 1973/74 to 30-40 percent in 1982/83-1995/96, and between 20-30 percent thereafter. Increased planting flexibility in U.S. farm legislation and low returns relative to competing crops has led to a decline in U.S. wheat area, limiting export potential.
Over the last decade, U.S. wheat exports have exceeded 30 million metric tons only twice. They peaked in 2007/08, when they reached 34 million metric tons, comprising 30 percent of world wheat exports. Although in the 2007/08 marketing year, total world wheat trade grew by 4 million metric tons, U.S. wheat exports increased by almost 10 million metric tons over the previous year. This was the biggest year-on-year increase for the United States in 20 years.
One reason U.S. wheat exports grew at the expense of other exporting countries is that in 2007/08 the United States had large stocks, which subsequently fell by 4 million metric tons. An important complementary reason was depreciation of the U.S. dollar vis-à-vis other major world currencies. From 2006 to mid-2008, the U.S. dollar depreciated by about 25 percent. The dollar's fall in value reduced the price for U.S. wheat compared to that produced by other countries. This disparity boosted U.S. exports in 2007/08, and lowered exports by other major wheat producers.
U.S. imports of wheat grain, mostly from Canada, are small (2-3 million metric tons), but have grown from less than a 100,000 metric tons in the 1970s to an average of 2.5 million metric tons over the last 10 years. Imports of wheat products consist mainly of pasta and noodles from the European Union (EU-27), Canada, and Asia.
Historical information on U.S. imports and exports is available from USDA's Foreign Agricultural Service (FAS) at Global Agricultural Trade System (GATS).
A long-term perspective on projected U.S. wheat exports is available in the Market Outlook chapter. The pages provide further information on the supply-and-demand issues for wheat underlying USDA's Agricultural Baseline Projections, which provides 10-year projections for the U.S. and world agricultural sectors for selected commodities.
World Wheat Trade
The United States is the world's leading wheat exporter. In most years, the United States, Canada, Australia, the EU-27, the former Soviet Union (including three major wheat exporters: Russia, Ukraine, and Kazakhstan), and Argentina account for about 90 percent of world wheat exports.
The diversity of exporting countries provides significant stability to world wheat trade and prices. Most of the world's wheat production is grown as winter wheat in the Northern Hemisphere, but Canada, Kazakhstan, Russia, and the United States have large spring wheat production, which is planted much later. Moreover, in the Southern Hemisphere, Australia and Argentina plant after the Northern Hemisphere's spring wheat. With wheat being planted and harvested at different times, countries can respond quickly to changing market conditions.
In the years before 2005/06, world wheat trade peaked in 1987/88 at 111.5 million metric tons, when China and the Soviet Union were importing very large amounts. After that and up until 2005/06, imports by Eastern Europe, the former Soviet Union, and China were much lower and world wheat trade did not match its 1987/88 level despite significant growth in imports by developing countries. In 2003, the EU established trade barriers to lower quality wheat imports, also limiting world wheat trade. In 2005/06, world wheat trade reached 114 million metric tons. In 2006/07, total wheat trade increased modestly, but in 2007/08, wheat trade stagnated with high prices.
Rising population in various parts of the developing world combined with strong economic growth have increased demand for both food and feed grains. Increasing amounts of food wheat are required to meet demand for staple food products in countries with low incomes and expanding populations in Sub-Saharan (Nigeria, Republic of South Africa, Sudan, and Kenya) and North Africa (Egypt, Algeria, and Morocco), South (Afghanistan, Bangladesh, and Pakistan) and South-East Asia (Indonesia, Philippines, and Vietnam), and Latin America (Brazil and Mexico). At the same time, some major importers from North Africa and the Middle East increased wheat imports when adverse weather lowered their supplies. (For detail on the countries in these regions, see the Regions used for FAS's Production, Supply, and Distribution (PS&D) database.)
While a handful of nations dominate wheat exports, there are many wheat-importing countries. A few countries account for a large share of world wheat imports, including the EU-27, Japan, South Korea, and Brazil. However, most wheat is imported by developing countries with limited production potential. Population growth in Egypt, Algeria, Iraq, Brazil, Mexico, Indonesia, Nigeria, and other developing countries will be the basis of future expansion of world wheat trade.
Data on world wheat Production, Supply, and Distribution (PS&D) are available from FAS for more than 200 countries back to 1960. More in-depth commodity trade information is available in ERS's data and outlook report on trade and FAS's Grain: World Markets and Trade. Current world wheat trade data are available in the World Agricultural Supply and Demand Estimates (WASDE).