Grain handlers are anticipating an uptick in orders for feed wheat, which should allow them to move excess wheat inventories as farmers bring in a record fall harvest. A new report from CoBank says low wheat prices and oversupply means wheat is destined to become a staple in livestock feed rations for at least the next year or two. A CoBank economist says, because of low prices, wheat will “remain competitive with other feed grains for the foreseeable future.” Current USDA forecasts indicate that wheat feeding and residual use will climb to 260 million bushels in 2016, up from 152 million bushels last year. With cash wheat prices continually finding new lows, USDA’s feed-wheat estimate could likely see upward revisions given wheat’s high stocks to use ratio.
The use of more feed wheat also will lower stocks of an oversupplied commodity, which could lead to better price stabilization.
Source: NAFB News Service