Though
the
volume
of
world
wheat
trade
has
changed
little
in
the
past
15
years,
shares
of
trade
volume
in
exporting
countries
have
changed
quite
a
bit.
The
U.S.
remains
the
largest
exporter,
but
U.S.
farmers
are
increasingly
producing
other
crops,
like
corn
and
soybeans,
so
the
U.S.
share
of
the
wheat
market
has
fallen
from
40
percent
in
the
1970s
to
23
percent
(forecast)
for
2002/03.
This
shift
in
U.S.
agricultural
production,
combined
with
rising
prices
caused
by
drought
in
three
of
the
largest
exporters—U.S.,
Australia,
and
Canada—has
created
opportunities
for
“nontraditional”
wheat
exporters.
With
their
favorable
climates
and
large
land
bases,
the
former
Soviet
Union
(FSU)
and
Central
and
Eastern
Europe
are
traditional
places
for
wheat
production.
Reductions
in
agricultural
subsidies
dur-
ing
the
1990s,
however,
caused
a
sharp
drop
in
livestock
production,
which,
in
turn,
curtailed
domestic
demand
for
wheat
as
an
animal
feed.
While
wheat
output
also
fell,
recent
large
harvests,
caused
largely
by
favorable
weather,
have
supported
wheat
exports.
FSU
wheat
exports
surged
in
2001/02
and
2002/03
as
increasing
world
prices
generated
the
investment
needed
to
expand
port
capacity.
In
2002/03,
Russia
is
expected
to
be
the
world’s
third
largest
wheat
exporter,
behind
the
U.S.
and
the
European
Union
(EU).
India,
Pakistan,
and
China
have
also
become
net
exporters
of
wheat
in
recent
years.
High
government
production
sup-
ports
during
the
1990s
boosted
production
and
stocks.
When
the
cost
of
maintaining
these
stocks
became
burdensome,
exports
increased,
particularly
as
prices
increased
in
2002/03.
However,
these
opportunistic
exports
are
not
expected
to
persist
because
these
countries
are
unable
to
pro-
duce
wheat
cheaply
enough
to
sustain
increased
exports
without
large
subsidies.
The
EU
continues
to
be
a
large
wheat
exporter.
Historically,
EU
wheat
produc-
tion
and
exports
depended
on
large
subsidies.
Despite
lower
domestic
wheat
prices,
EU
wheat
production
has
grown
because
of
favorable
net
returns
compared
with
those
for
other
crops.
Lower
prices
have
increased
the
domestic
feed
use
of
wheat,
limiting
exports.
The
U.S.
is
expected
to
remain
the
world’s
largest
wheat
exporter,
though
its
share
will
likely
decline
if
U.S.
producers
continue
to
turn
to
other
crops
and
if
other
countries
find
wheat
profitable.
As
export
shares
shift,
changes
in
U.S.
supply
will
not
affect
prices
as
much
as
in
the
past.
For
example,
when
the
U.S.,
Canada,
and
Australia
suffered
from
drought
in
2002/03,
nontraditional
exporters
and
the
EU
were
able
to
export
enough
to
keep
a
lid
on
prices.
Edward
W.
Allen
,
ewallen@ers.usda.gov
Ronald
Trostle
,
rtrostle@ers.usda.gov
This
finding
is
drawn
from
.
.
.
Wheat
Yearbook,
03.27.03,
available
at:
www.ers.usda.gov/publications/so/view.asp?f=
field/whs-bby
ERS
Wheat
Briefing
Room,
at
www.ers.usda.
gov/Briefing/Wheat
4
E
C
O
N
O
M
I
C
R
E
S
E
A
R
C
H
S
E
RV
I
C
E
/
U
S
D
A
F
I
N
D
I
N
G
S
M
A
R
K
E
T
S
A
N
D
T
R
A
D
E
Nontraditional
Exporters
Increase
Role
in
Wheat
Markets
U.S.
share
of
world
wheat
market
is
declining
0
20
40
60
80
1960
62
64
66
68
70
72
74
76
78
80
82
84
86
88
90
92
94
96
98
00
02
100
120
Exports,
million
metric
tons
Source:
USDA
Production,
Supply,
and
Distribution
database.
Other
Former
Soviet
Union
&
Central
and
Eastern
Europe
European
Union
15
Canada,
Australia,
&
Argentina
U.S.
Photo
by
Tim
McCabe,
USDA/NRCS