Good luck for farmers in some important parts of the wheat world is
spoiling prairie farmers’ hopes for better wheat prices in 2002-2003,
says the Canadian Wheat Board’s most recent pool return outlook.
However, bad luck in the United States’ hard red winter wheat area
could change the price forecast.
Analysts say it’s too early to bank on the American crop failing, but
U.S. conditions are poor.
“Everyone says the (hard red winter wheat) crop has nine lives, but I
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think the chance of them reaching last year production levels is pretty
low,” said CWB weather and crops analyst Bruce Burnett.
Last week’s PRO saw wheat prices generally drop by about $3 per tonne.
Durum was relatively flat. Feed barley prices plunged by $11 per tonne
and dragged malt barley down by $9 per tonne.
The board blamed the price weakness on good wheat growing conditions in
the European Union and the former Soviet Union combined with softer
import demand and strong export competition.
But it said prices might be strengthened by dryness in the U.S. hard
red winter wheat belt, the Canadian Prairies and in China.
Hard red winter wheat, mainly produced in Kansas, Oklahoma and Texas,
is close to heading.
It has suffered from dryness and heat and cold extremes in many areas
and looks weaker than last year’s poor crop.
“The crop conditions are suggesting we’re going to have a smaller crop
than what we had last year,” said Kansas State University crop analyst
Bill Tierney.
His most recent estimates peg the crop at 15 percent very poor, 23
percent poor, 36 percent fair, 23 percent good and three percent
excellent.
But there’s still lots of time for the crop to recover, he said.
A year ago, crop forecasters put the hard red winter wheat crop in
Kansas at about 286 million bushels. By August, that estimate had
increased to 344 million bu.
In the January estimate, the crop came in at 328 million bu.
That significant size swing illustrates how quickly crop conditions can
change, Tierney said.
“It’s beginning to look like perhaps 2002 will follow the pattern that
was set in 2001,” said Tierney.
“The hard red winter wheat crop starts out low and then adds bushels.
But we won’t know that unless we can say what the weather’s going to be
for the next 60 days, and I can’t do that.”
Burnett, who recently toured the hard red winter wheat area, said poor
conditions are limiting the crop’s potential. The extremes of hot and
cold recently set it back.
“There’s been a lot of stress put on the crop and combined with poor
soil moisture that’s caused some damage to the crop,” said
Burnett.”There is some damage that is irreversible.”
That means Canadian farmers will have to wait until the U.S. winter
wheat harvest begins in July before they’ll know whether poor yields
there will result in better prices.
