Market Trends of North America Wheat Industry
Growing Demand for Animal Feed
- Wheat is a common ingredient in animal feed formulations, providing essential nutrients and energy for livestock such as cattle, poultry, and swine. The growing North American population has increased the demand for meat, dairy, and egg products, leading to a rise in livestock and poultry production to meet consumer needs. According to the United States Department of Agriculture (USDA), beef production in the United States increased from 12.7 million metric tons in 2021 to 13.5 million metric tons in 2023. Additionally, the total broiler production in 2023 reached 4.5 million metric tons. This substantial livestock population is generating significant demand for wheat feed, driving the market growth.
- According to the Decision Innovation Solutions (DIS) of the American Feed Industry Association (AFIA), pets and domestic livestock in the United States consumed approximately 295 million metric tons of animal feed in 2023. The top three feed consumers were beef cattle (64.5 million metric tons), hogs (61.8 million tons), and broiler chickens (60.8 million tons). The states with the highest animal food consumption were Iowa (28.8 million metric tons), Texas (21.1 million metric tons), California (17.5 million metric tons), North Carolina (16.3 million metric tons), and Minnesota (14.6 million metric tons). This substantial consumption of feed is driving the demand for wheat in North America.
- Improvements in feed formulation technologies have facilitated the expansion of wheat-based feed. Advanced feed mixing equipment and precise nutrition models have enabled livestock and poultry producers to incorporate wheat into animal diets more accurately without affecting performance. According to the Institute of Feed Education and Research (IFEEDER), the consumption of wheat middlings and wheat bran as animal feed reached 8.5 million metric tons in 2023. These developments have enhanced wheat's attractiveness as a feed ingredient throughout the region.
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United States Dominates the Market
- Wheat stands as the primary food grain produced in the United States. The country cultivates three main varieties, which include winter wheat, spring wheat, and durum wheat. Domestic consumer demand for wheat flour-based food products remains relatively constant, showing minimal fluctuation in response to changes in wheat prices or disposable income. The United States Department of Agriculture (USDA) reported that the National Agricultural Statistics Service (NASS) estimated 34.4 million acres of winter wheat planted for harvest in 2023, as part of the country's wheat production highlights.
- The United States typically produces an average of about 6% of the world's wheat annually, yet it remains one of the major wheat exporters. In 2023, the country's wheat exports reached 17.9 million metric tons, according to ITC Trade Map. This export volume is achieved through the cultivation of advanced winter seed varieties that yield sufficient quantities for both domestic and international markets. The USDA estimates that farmers have seeded 79% of the 2023 winter wheat crop. United States wheat farmers consistently produce high-quality wheat supplies in sufficient quantities to meet domestic and international demands for a wide variety of baked goods.
- Furthermore, the United States boasts a well-established infrastructure for wheat transportation and distribution. With its vast network of railways, ports, and processing facilities, wheat can be moved efficiently across North America. This efficiency makes it more cost-effective for markets in Canada and Mexico to source wheat from the U.S. instead of looking overseas. Additionally, trade agreements such as the USMCA (United States-Mexico-Canada Agreement) streamline these trade flows. By reducing tariffs and other barriers, these agreements further encourage United States wheat supplies among its North American neighbors.
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