Wheat Outlook William I. Tierney, Jr. PhD Chief Economist AgResource Company, Chicago IL. OSU Extension Webinar April 15, 2013
US Drought Monitor – 2013 vs2012 Apr 10, 2012 Apr 09, 2013 Drought Severity D0 - Abnormally Dry D1 - Drought - Moderate D2 - Drought - Severe D3 - Drought - Extreme D4 - Drought - Exceptional
Global Wheat’s Weather Problems Also Include Too Much Rain “The Summer That Never Was in UK” Will Boost UK’s Imports. Continued Rains Will Reduce 2013 Area Seeded by 12-15%. 14 Mln Ha Affected by Flooding in Arg’s Buenos Aires and Santa Cruz. How Much Much Damage Did Wheat Crop Suffer?
Crops in Canada & U.S. N. Plains Will be Planted Late Resulting in Lost Acres and Reduced Yields Approximate crop yield decline each day Alberta crops’ seeding date is delayed after May 1 Crop% Yield decline/day Barley - grain 1.3 Barley - silage 1.0 Triticale - grain 0.8 Triticale - silage 1.1 Wheat – HRS 0.8 Wheat - durum 1.3 Canola 1.7 Flax 0.6
Per Capita Use Has Been Steady Thanks, In Part, to EU Biofuels Use.
US SRW Now World’s Cheapest Wheat. But Black Sea “New Crop Quotes” Less Than US.
India Has More Wheat to Export But Will They Sell At Prices Below The Govt’s Support Price?
Wheat Prices Seem to be a Function of Exporters’ Stocks/Use and Corn Price
A Weekly Close Above The Downtrend Line Signals to Hold Off on Further Sales.
Downside Risk is $6.00/Bu Basis the “Nearby” KCBT Futures History
$.40/Bu “Carry” from Jul ‘13 to Mar ‘14 ($.05/Bu/Month). Farmers With On-Farm Storage May Want to Hedge in KWH14. KC HRW 13% is 40-50 cents/bu > HRW Ord. Problems with N. American Spring Wheat crop could push up protein premiums.