Soft Red Winter Archives - Page 5 of 7

Hard Red Winter, Market and Crop Analysis, Soft Red Winter, Supply and Demand, Wheat Quality

Good Quality, Competitive Prices Spark U.S. Winter Wheat Demand

By Claire Hutchins, USW Market Analyst

As marketing year (MY) 2018/19 draws to a close, customers of U.S. winter wheat are taking advantage of excellent buying opportunities on competitive pricing and high-quality, consistent supplies. Since the first week in January, the 2018/19 export sales pace for hard red winter (HRW) and soft red winter (SRW) surpassed last year’s pace for deliveries in the current marketing year (CMY) and the new marketing year (NMY).

According to USDA commercial sales data as of April 4, 2019, HRW sales for 2018/19 delivery total 8.70 million metric tons (MMT). That is down 4% from this time last year but up 4% from the 5-year average of 8.33 MMT. Between February 14 and April 4, weekly sales of HRW for CMY delivery were significantly higher than the same six weeks in 2017/18 on low prices and high crop quality attributes. In the April 12 U.S. Wheat Associates (USW) Price Report, estimated FOB export price for 12% protein HRW (12% moisture basis) out of the Gulf at $222/MT for May 2019 delivery compared to $258/MT for delivery in May 2018. HRW export basis for the same delivery month, at $1.70/bu, is significantly lower than last year’s $1.95/bu. In addition to lower FOB export prices, the 2018/19 HRW crop features excellent milling and baking qualities.

These market factors also support a significant uptick in HRW commercial sales into the NMY compared to NMY sales booked by the same time in 2017/18. HRW export sales for the 2019/20 marketing year total 396,000 metric tons (MT), up 64% from this time last year and 17% from the 5-year average. This represents the highest volume of HRW NMY sales to date since 2014/15. The most recent USW Price Report estimates 12% HRW FOB price for June 2019 delivery at $224/MT, compared to last year’s estimate of $259/MT for delivery in June 2018.

Members of the grain trade expect HRW FOB prices and export basis out of the Gulf to decrease steadily into the new marketing year on somewhat larger ending stocks, reduced inland logistical challenges, and favorable new crop conditions.

Turning to SRW, commercial sales to date for 2018/19 delivery total 3.30 MMT, up 36% year-over-year and 10% more than the 5-year average. This represents the highest volume of SRW commercial sales for CMY delivery since 2014/15. Competitive prices, higher than average protein levels and lower than average DON levels continue to elevate SRW export business through the second half of MY 2018/19. More information about the 2018/19 SRW crop is available at https://bit.ly/2ZdnMwi.

The latest USW Price Report valued the SRW export FOB price out of the Gulf at $204/MT for May 2019 delivery compared to $208/MT last year. SRW export basis for May 2019 delivery out of the Gulf at $0.90/bu is 5 cents less than last year’s estimate for May 2018 delivery.

Grain traders expect SRW FOB export prices and export basis to decline steadily into the first few months of MY 2019/20 despite tightening 2018/19 U.S. SRW ending stocks, which are forecast to fall to 4.57 MMT, 18% below 2017/18 and 7% below the 5-year average.

As with HRW sales, total SRW commercial sales for 2019/20 delivery are significantly higher than NMY sales booked this time last year. SRW commercial sales for NMY delivery total 302,000 MT, up 23% year-over-year and 15% from the 5-year average. This represents the highest volume SRW NMY sales to date since 2014/15 as customers look to lock in high quality supplies at globally competitive prices. The April 12 Price Report estimates SRW FOB price out of the Gulf for June 2019 delivery at $202/MT compared to last year’s estimate of $213/MT for the same delivery month in 2018.

April 18, 2019/by actualize

Exports, Soft Red Winter, Steve Mercer, Supply and Demand, Wheat Production and Harvest, Wheat Quality

Here Are 5 Things to Know About SRW Supply and Demand

By Steve Mercer, USW Vice President of Communications

Grown in the eastern United States, soft red winter (SRW) wheat is a profitable choice for producing confectionary products like cookies (biscuits), crackers and cakes, and to blend its flour for baguettes and other bread products. U.S. Wheat Associates (USW) wants to share some key points about SRW exportable supply in marketing year 2018/19 and look ahead to its potential for 2019/20.

1. Good Quality. While excessive rain on the 2018/19 SRW crop did slightly lower average test weight and falling number, protein (9.9% on 12% moisture basis, composite) is above average and DON level (0.7 ppm composite) is slightly below average. Processors should find good qualities for crackers and segments of the crop with good cookie and cake qualities. The higher protein and good extensibility in the crop should add value in blending for baking applications. See more information at https://www.uswheat.org/market-and-crop-information/crop-quality/.

2. Least Cost. SRW is the lowest cost milling wheat in the world today, offered at an average FOB export price of US$202 per metric ton* for June delivery from U.S. Gulf ports. The International Grains Commission in its March Grain Market Report estimated SRW FOB price at $211, which is $6 less than French soft wheat. SRW exportable supplies are also available from Lakes ports (Toledo, Ohio), and Atlantic ports (Norfolk, Virginia, and Wilmington, North Carolina). See more information at https://www.uswheat.org/market-and-crop-information/price-reports/.

3. Supply is Down. Ending stocks of SRW have declined from 5.9 MMT in 2016/17 to USDA’s latest estimate of 4.6 MMT for 2018/19 (by comparison, SRW ending stocks in 2013/14 were 3.1 MMT after China imported 3.6 MMT that marketing year). Reduced supply relates to a near 50% decline in total production from 15.4 MMT in 2013/14 to USDA’s current estimate of 7.8 MMT in 2018/19, as well as an upturn in exports (see below). See more information at https://www.uswheat.org/market-and-crop-information/supply-and-demand/.

SRW ending stocks have declined steadily since 2016/17 on less production and more exports. Source: USDA

4. Demand is Up. As of April 4, SRW exports of 3.3 million metric tons (MMT) are 36% more than at the same time in marketing year 2017/18. This represents the most volume SRW sales year to date since 2014/15. Commercial SRW sales to Mexico, Colombia, Peru, Ecuador and Brazil are up significantly, as are imports by Central American and Caribbean countries and Nigeria. See more information at https://www.uswheat.org/market-and-crop-information/commercial-sales/.

U.S. SRW wheat supplies are down; export demand takes an upturn. Source: USDA

5. Planted Area is Down. In February 2018, USDA reported that SRW seeded area for 2019/20 is 5.7 million acres (2.4 million hectares), or down 7% from last marketing year. Most of the states that typically produce the most exportable SRW supplies planted less. This decline is not more significant only because some farmers can harvest SRW and then quickly plant soybeans to get a double crop from the same acre. In general, U.S. crop farmers, who are driven by economic circumstances to minimize their net losses at best this year, are turning away from winter wheat to other crops that offer better returns. Total U.S. winter wheat seeded area for 2019/20 is at its second lowest level on record. See more information at https://www.nass.usda.gov/Publications/Todays_Reports/reports/wtrc0219.pdf.

*Source: USW Price Report, April 12, 2019

April 16, 2019/by actualize

Erica Oakley, Hard Red Spring, Hard Red Winter, Hard White, Market and Crop Analysis, Northern Durum, Soft Red Winter, Soft White, Wheat Quality

Annual Crop Quality Report and Seminars Will Help Customers Make Purchasing and Milling Decisions

By Erica Oakley, USW Director of Programs

As a key part of its commitment to transparency, each year U.S. Wheat Associates (USW) produces an annual Crop Quality Report that includes grade, flour and baking data for all six U.S. wheat classes. The report is compiled from sample testing and analysis conducted during and after harvest by our partner laboratories. The report provides essential, objective information to help buyers get the wheat they need at the best value possible.

The 2018 USW Crop Quality Report is now available for download in English, Spanish, French and Italian, and will be available in Chinese and Arabic soon. USW also shares more detailed, regional reports for all six U.S. wheat classes on its website, as well as additional information on its sample and collection methods, solvent retention capacity (SRC) recommendations, standard deviation tables and more.

USW’s annual Crop Quality Seminars are already underway and will continue over the next month around the world. USW invites its overseas customers, including buyers, millers and processors, to these seminars led by USW staff, U.S. wheat farmers, state wheat commission staff and educational partner organizations. The seminars dive into grade factors, protein levels, flour extraction rates, dough stability, baking loaf volume, noodle color and texture and more for all six U.S. wheat classes, and are tailored to focus on the needs and trends in each regional market.

In 2018, USW is projected to host 41 seminars in 28 countries.

Customers have previously shared that they use the report throughout the year as a reference manual and to guide them through purchases and future planning. The seminars provide a first look at the overall crop and a deep dive into the data and how to use it. Customers will often use the seminars and report as educational training for new employees.

The reports and seminars have been a traditional part of USW’s strategy since 1959, growing to become its single largest marketing activity.

November 1, 2018/by actualize

Desert Durum, Hard Red Spring, Hard Red Winter, Hard White, Market and Crop Analysis, Northern Durum, Soft Red Winter, Soft White, Stephanie Bryant-Erdmann, Supply and Demand, Wheat Production and Harvest

USDA Confirms Ample U.S. Wheat Supply in 2018/19, Reassures Customers About Availability

By Stephanie Bryant-Erdmann, USW Market Analyst

On Sept. 28, USDA released its Small Grains Summary noting that 2018/19 U.S. wheat production increased to 51.3 MMT, up 8 percent from last year due to improvements in both average yield and harvested area. While this is still 8 percent below the 5-year average of 55.8 MMT, the 2018/19 production coupled with significant carry-in stocks ensure that the U.S. wheat store will remain open and well-stocked throughout 2018/19. Here is a look at 2018/19 U.S. wheat production by class.

Hard red winter (HRW). Last fall, U.S. farmers increased HRW planting in the U.S. Southern Plains due to favorable moisture conditions. That slight increase was not enough to offset decreased planted area in the U.S. Northern Plains where a long-term drought delayed, and in some cases, prevented winter wheat planting. Planted area in Montana fell 6 percent year over year. USDA reported HRW planted area at 23.2 million acres (9.39 million hectares), down 2 percent from 2017. Unfortunately, most of the Southern Plains received little to no moisture until spring, with some areas going from October to April without measurable precipitation. The poor weather caused Oklahoma wheat farmers to abandon 43 percent of their winter wheat area, up from both the 5-year average and the 2017/18 abandonment rate of 36 percent. The average HRW yield in Kansas and Oklahoma, the top two HRW-producing states, decreased 21 percent and 18 percent from 2017/18, respectively. With the drought causing both harvested area and average yields to fall, USDA estimates total 2018/19 HRW production dropped 12 percent to 662 million bushels (18.0 MMT). Though smaller in volume, 2018 HRW quality i is excellent. Read more here.

Hard red spring (HRS). Wet conditions slowed HRS planting but replenished depleted soil moisture across the drought stressed Northern Plains. USDA says U.S. farmers planted 12.1 million acres (4.90 million hectares) to HRS, up 17 percent from the year prior. The beneficial moisture boosting average HRS yields and harvested area. In North Dakota, the top HRS producing state, the average yield climbed 20 percent year over year to a record high 49.0 bu/acre (3.29 MT per hectare), up 41 percent from 2017/18. Idaho farmers also produced record high HRS yields. USDA now reports HRS production at 587 million bushels (16.0 MMT), up 53 percent from 2017/18.

Soft red winter (SRW). Last fall, U.S. farmers planted 5.85 million acres (2.37 million hectares) of SRW, up 4 percent from the year prior, but still 23 percent below the 5-year average. While planting conditions were generally favorable, depressed prices kept planted area low. In early 2018, several U.S. SRW growing areas received excessive moisture that decreased yield potential and the wet weather continued through harvest. USDA reported SRW production totaled 286 million bushels (7.78 MMT), down 2 percent from 2017/18 and 33 percent below the 5-year average of 429 million bushels (11.7 MMT). Read more here.

White wheat (including soft white, club and hard white). U.S. white wheat planted acres stayed close to the 5-year average at 4.15 million acres (1.68 million hectares) in 2018/19. A wet winter boosted yield potential for both the winter and spring crops. The average spring white wheat yield in Washington increased 20 percent to 54.0 bu/acre (3.63 MT per hectare). The slight increase in harvested area and significant improvement in average yields pushed 2018/19 total white wheat production to 272 million bushels (7.41 MMT), a 5 percent increase year over year, and 8 percent above the 5-year average of 252 million bushels (6.86 MMT).

Durum. Farmers planted less durum area this year in response to lower prices and large carry-out stocks during spring planting. USDA estimates 2.00 million acres (810,000 hectares) were planted to durum, down 13 percent from 2017/18 but still 9 percent above the 5-year average of 1.84 million acres (745,000 hectares). USDA estimated total 2018/19 U.S. durum production at 77.3 million bushels (2.10 MMT), up 41 percent from last year. Generally favorable weather boosted yields in the U.S. Northern Plains, with average durum yields increasing to 39.3 bu/acre (2.64 MT per hectare), up 13.3 bu/acre from last year when drought severely impacted the crop. Desert Durum^® production fell 8 percent year over year to 10.5 million bushels (385,000 MT) due to sharply lower planted area in both Arizona and California.

October 3, 2018/by actualize

Market and Crop Analysis, Soft Red Winter, Wheat Quality

Rain-Challenged 2018 SRW Crop Still Grades Above Average and Offers Performance Value

U.S. farmers growing soft red winter (SRW) wheat, especially in the East Coast states, experienced difficult growing conditions in 2018 with excessive moisture affecting test weight, falling number and DON values. Overall, however, several grade factors in the 2018 SRW crop are better than the 5-year averages, protein is somewhat above average, and DON is somewhat below average. Processors should find good qualities for crackers and segments of the crop with good cookie and cake qualities. With higher protein and good extensibility, the crop should also be valuable in blending for baking applications.

That is a summary of results from the U.S. Wheat Associates (USW) 2018 SRW Crop Quality Report, now posted online here. To complete the report, Great Plains Analytical Laboratory in Kansas City, Mo., collected and analyzed 265 samples from 18 reporting areas in the 11 states that account for most of U.S. SRW 2018 production. USW and the USDA Foreign Agricultural Service fund the annual survey.

Wheat and Grade Data

With analysis result weighted by estimated state production, the average grade of all samples collected for the 2018 SRW harvest survey is U.S. No. 3. The weighted average test weight is 57.9 lb/bu (76.2 kg/hl), slightly below the 59.1 lb/bu (77.1 kg/hl) 2017 average. The Gulf Port average of 58.2 lb/bu is similar to the 5-year average of 58.4 lb/bu (76.8 kg/hl). The East Coast test weight average of 56.6 lb/bu (74.5 kg/hl) is below both last year. All other grade factors, dockage and moisture are similar to or lower than 2017 average values. The Gulf Port Total Defects average of 0.8% is below the previous 5-year minimum, indicating that damaged and shrunken and broken kernels are unusually low in that portion of the crop.

The composite average wheat protein content of 9.9% (12% moisture basis) is higher than 2017’s 9.5% and the 5-year average of 9.7%. Both the Gulf Port protein average of 9.9% and East Coast average of 10.2% are above the 2017 and 5-year averages. The composite average falling number of 322 seconds is similar to 2017. The Gulf Port average of 327 seconds is slightly above last year, while the East Coast average of 301 seconds is slightly below last year. Fewer than 10% of samples had a falling number below 250 seconds in 2018. The composite DON average of 0.7 ppm is above the very low 2017 value of 0.2 ppm but is below the 5-year average of 1.3 ppm. The East Coast value of 1.1 ppm is similar to the 5-year average while the Gulf Port value of 0.7 ppm is below the 5-year average. Of the samples tested for DON, 75 percent of the Gulf Port results and 65 percent of the East Coast results were less than 1.0 ppm.

Flour and Baking Data

The composite, East Coast and Gulf Port Buhler laboratory mill flour extraction averages are below 2017 and the 5-year averages. The farinograph peak values are similar to 5-year averages, but the stability and absorption values are all below last year and the 5-year averages. The SRC values generally indicate acceptable quality for crackers; some Gulf Port areas also have acceptable SRC values for cookies. The composite and Gulf Port alveograph L averages of 97 and 98 are higher than last year and the respective 5-year average of 89 for both, indicating good extensibility.

All other alveograph averages are similar to the respective 5-year averages given the variability of alveograph analysis. The Gulf amylograph average of 614 BU indicates good quality for cakes. The composite and Gulf Port cookie spread ratios are all higher than last year and similar to the 5-year averages, again indicating good extensibility. Average loaf volumes are also all higher than last year and the 5-year averages.

USW will share complete data for all classes of U.S. wheat with hundreds of overseas customers at several upcoming events, including USW’s annual Crop Quality Seminars, and in its annual Crop Quality Report. Buyers are encouraged to review their quality specifications to ensure that their purchases meet their expectations.

View the 2018 Soft Red Winter Crop Quality Report here.

August 15, 2018/by actualize

Hard Red Winter, Soft Red Winter, Soft White, Supply and Demand, Wheat Production and Harvest

A Mid-Season Look at the U.S. Winter Wheat Harvest for Buyers

U.S. farmers are making good progress now on the second half of their 2018 winter wheat harvests and U.S. Wheat Associates (USW) wants to provide a mid-season look at winter wheat harvest and quality in this “Wheat Letter” entry. USW publishes a new Harvest Report every Friday on this website.

Soft Red Winter (SRW) harvest of a crop that was quite affected by rain throughout the growing season is now complete. Planted area was up somewhat compared to last year’s record low level. With abundant rain, yields were above average for the year but test weights from crops in both the East Coast and Gulf port tributaries are less than last year and the 5-year average. That knocks down the U.S. Grade for this crop to #3 SRW. DON levels are slightly higher in 2018 but are below the 5-year average. Processers should find good qualities for crackers overall and for cookies from segments of the crop. With higher protein and good extensibility, the crop should also be valuable for blending for baking applications. USW will post the final SRW quality report within the next few weeks.

Past USW Director John Hoffman of Circleville, Ohio, just beat the rain to complete his 2018 SRW harvest.

Hard Red Winter (HRW) harvest is more than 80 percent complete and buyers should want to take a very good look at the 2018 crop. Starting with another record low planted area, USDA believes farmers will harvest 17.9 million metric tons (MMT) of HRW this year or 12 percent less than in 2017. That amount is likely to change as USDA measures the effects of abandoned area in drought stressed areas of the Southern Plains. For buyers, however, this is a very good supply of HRW with composite protein holding at 12.6% (12% moisture) and test weights at 79.7 kg/hl (60.6 lb/bu). Quality reports from Montana’s harvest are even better. While flour and dough properties are just being measured for this crop, domestic millers and processors are saying they like what they see in this HRW crop.

HRW farmer Peter Miller of Lodgepole, Nebraska, posted this photo on his Twitter account @pmiller1320 on July 23.

Soft White (SW) winter wheat growing conditions across the Pacific Northwest (PNW) were nearly ideal for the 2018 crop. As of Aug. 3, the PNW SW harvest was 55% complete in Oregon (sadly aided by destructive fires in the north-central part of the state), 28% in Washington and 12% in Idaho. Industry sources say continued dry weather has pushed progress beyond those levels since early this week. Dryland yields are well above normal and early quality analysis indicate good test weight at 61.8 lb/bu (81.3 kg/hl), very low moisture content at 8.4%, low protein at 9.4% (12% moisture basis), and sound falling number value at 305 seconds.

Logan Padget, son of USW Secretary-Treasurer Darren Padget, of Grass Valley, Oregon, posted this beautiful image of SW “Harvest Time” on their farm July 23.

We hope you will subscribe to USW’s Harvest Report and if you want to ask questions about this year’s crops or about other topics related to U.S. wheat and U.S. wheat exports, visit our new “Ask the Expert” section of this website at https://www.uswheat.org/market-and-crop-information/ask-the-expert/.

August 6, 2018/by actualize

Exports, Hard Red Spring, Hard Red Winter, Market and Crop Analysis, NAFTA and USMCA, Soft Red Winter, Stephanie Bryant-Erdmann, Supply and Demand, Trade Policy

Lower U.S. Wheat Futures: An Anomaly and Excellent Opportunity

By Stephanie Bryant-Erdmann, USW Market Analyst

There is an old saying: “When there’s blood on the streets, buy property.” Given recent price movements, that could easily be changed to: “When trade policies are in the news, buy wheat.”

Since the steel and aluminum tariffs went into full effect for major U.S. wheat customers, September Kansas City hard red winter (HRW) wheat futures have fallen 51 cents per bushel ($19 per metric ton [MT]), September Chicago soft red winter (SRW) wheat futures dropped 25 cents per bushel ($9 per MT) and Minneapolis hard red spring (HRS) plunged 58 cents per bushel ($21 per MT).

Seasonal harvest pressure always impacts U.S. wheat prices during the summer months; however, this year the unique trade environment is also pressuring export demand and driving U.S. wheat prices lower. As of July 19, U.S. export sales for marketing year 2018/19 (June 1 to May 31) totaled 6.43 MMT, down 32 percent year over year. Exporters note that customers are choosing to purchase smaller than normal volumes of U.S. wheat, just what they need for the short-term or are waiting to make purchases, noting uncertainty about U.S. trade policies and their own countries’ retaliatory measures. Sales to the top five U.S. wheat customers — Mexico, Japan, the Philippines, Korea and Nigeria — are 27 percent behind last year’s pace.

U.S. wheat futures prices are not reflecting global supply and demand realities. Buyers are uncertain about the effects of unforeseen tariff wars and have altered their typical wheat import cadences.

With trade policy issues dominating the headlines, U.S. wheat futures markets are mostly ignoring global wheat supply and demand fundamentals, which can be seen in competitors’ wheat prices. The average global wheat price is up 41 cents per bushel ($15 per MT) with larger increases noted in Australia and Argentina, which compete with the United States in key quality-driven markets. According to International Grains Council (IGC) data, the average price of Australian wheat is up $19 per MT and the average price of Argentine wheat is up $75 per MT. These price increases are driven by increased global wheat demand, shrinking global wheat supplies and their location.

USDA noted in last week’s World Agricultural Supply and Demand estimates that global wheat production will fall to 737 MMT in 2018/19, the first drop in 5 years and down 3 percent from 2017/18. Decreased production is expected in the European Union (EU), Russia, Ukraine, Kazakhstan, and Australia. While the United States, Canada and Argentina are expected to have increased production, exporter supplies are expected to fall 20.2 MMT year over year.

Simultaneously, many importers are engaging in “just in time” purchases since wheat price movement has rewarded their patience the last few years. USDA expects importer ending stocks to fall to 49.8 MMT in 2018/19, the lowest amount in a decade.

While importer stocks are shrinking, USDA expects global wheat demand to surge to a new record high of 749 MMT, 4 percent above the 5-year average. That means that global wheat consumption will outpace global wheat production by 12.6 MMT this year and drop the global wheat stocks-to-use ratio (excluding China) to less than 20 percent. A level that has not been seen since 2007/08.

For perspective, in July 2007 all three wheat futures were above $6.00 per bushel ($220 per MT) and would continue climbing until March 2008 when prices peaked at $11.60 per bushel ($426 per MT) for SRW, $12.17 per bushel ($447 per MT) for HRW and $17.30 per bushel ($636 per MT) for HRS. On Friday, July 20, those three futures were at $5.16 per bushel ($190 per MT), $5.08 per bushel ($187 per MT) and $5.55 per bushel ($204 per MT), respectively, indicating there is a lot of room for upward mobility.

With exporter supplies shrinking and importers continuing a “just in time” purchasing pattern, global wheat prices are sitting on a powder keg that trade policy issues are currently disguising. Customers should take advantage of current U.S. futures price levels and lock in the competitive prices.

To track U.S. wheat export prices, subscribe to the USW Weekly Price Report.

July 23, 2018/by actualize

Hard Red Spring, Hard Red Winter, Market and Crop Analysis, Northern Durum, Soft Red Winter, Soft White, Wheat Production and Harvest, Wheat Quality

USW Harvest Reports Now Posting Every Friday

Generally cool spring conditions delayed the start of the 2018/19 U.S. winter wheat harvest, but the combines are now in the fields and U.S. Wheat Associates (USW) published a preliminary Harvest Report on May 25. USW Harvest Reports are published every Friday afternoon, Eastern Daylight Time, throughout the season with updates and comments on harvest progress, crop conditions and current crop quality for hard red winter (HRW), soft red winter (SRW), hard red spring (HRS), soft white (SW) and durum wheat.

The weekly Harvest Report is a key component of USW’s international technical and marketing programs. It is a resource that helps customers understand how the crop situation may affect basis values and export prices.

USW’s 14 overseas offices share the report with their market contacts and use it as a key resource for answering inquiries and meeting with customers. USW also publishes the report in Spanish as “Trigonoticias,” distributed to Latin American wheat buyers and millers and posted on www.uswheat.org.

Anyone may register to subscribe to an email version of the Harvest Report. For the first time this year, USW includes links in the email to additional wheat condition and grading information, including the U.S. Drought Monitor, USDA/NASS Crop Progress and National Wheat Statistics, the official FGIS wheat grade standards and USDA’s World Agricultural Supply and Demand Estimates report. Harvest Reports are also posted online at www.uswheat.org/harvest.

May 31, 2018/by actualize

Desert Durum, Hard Red Spring, Hard Red Winter, Hard White, Market and Crop Analysis, Northern Durum, Soft Red Winter, Soft White, Stephanie Bryant-Erdmann, Wheat Production and Harvest

Even with Lower HRW Outlook, U.S. Wheat Production Called Up for 2018/19

By Stephanie Bryant-Erdmann, USW Market Analyst

With the small, stressed hard red winter (HRW) wheat crop getting the lion’s share of attention, it was an initial surprise to read in USDA’s May World Agricultural Supply and Demand Estimates (WASDE) that U.S. wheat production is expected to increase to 49.6 million metric tons (MMT) in 2018/19. That would be up 5 percent year over year, if realized.

The forecast increase is a result of greater harvested area and slightly higher average yield in the other classes. USDA forecast 2018/19 all wheat average yield at 46.8 bushels per acre (3.15 metric tons [MT] per hectare), up from 46.3 bushels per acre (3.11 MT per hectare) last year. Harvested area is expected to increase 1.3 million acres (526,000 hectares) in 2018/19. Crop condition ratings also matter in this forecast, and as the following by-class reviews show, HRW is clearly the exception to the up-trend in production.

HRW production is expected to be the smallest since 2006/07 at 17.6 MMT. If realized, that would be down 14 percent year over year and 22 percent below the 5-year average. Low farm-gate prices and poor planting weather last fall reduced 2018/19 U.S. HRW planted area to 23.2 million acres (9.4 million hectares), the second lowest planted area on record. That poor start coupled with widespread drought throughout the U.S. Southern Plains set up the current situation where harvested HRW acres are expected to fall 5 percent from 2017/18 to 16.5 million acres (6.68 million hectares).

The large decrease in harvested acres is centralized in the U.S. Southern Plains where HRW crop condition ratings remain poor. In top HRW-producing states of Kansas, Oklahoma and Texas, 51 percent, 65 percent, and 59 percent of HRW is rated poor or very poor, respectively. As a consequence of the drought and resulting poor crop conditions, USDA expects harvested area in Oklahoma to fall 31 percent year over year to 2.0 million acres (810,000 hectares). On May 10, USDA rated 25 percent of HRW in the states surveyed in good to excellent condition, while 45 percent is rated poor or very poor. Read more about the all too evident challenge of wheat farming on the High Plains.

Soft red winter (SRW) production is expected to increase to 8.57 MMT in 2018/19. If realized, that would be up 8 percent year over year, but still 22 percent below the 5-year average. 2018/19 U.S. SRW harvested area is expected to increase 8 percent from the year prior to 4.0 million acres (1.62 million hectares). USDA also expects record high yields in Indiana, Kentucky, Maryland and Michigan due to favorable growing conditions this spring.

On May 14, USDA noted week over week crop condition rating improvements in nearly all SRW-growing states, with 67 percent of the SRW acres surveyed rated good to excellent. Week over week improvements were noted in Illinois and Arkansas where 63 percent of SRW was rated good to excellent, up 10 percentage points and 5 percentage points, respectively, from the week prior.

White wheat.* 2018/19 white winter wheat production is forecast at 6.24 MMT, including 5.66 MMT of soft white (SW) winter wheat and 577,000 MT of hard white (HW) winter wheat. If realized, SW winter wheat production would be up 2 percent year over year, due to increased planted area, while HW winter wheat production would be down 11 percent from 2017/18 due to forecast reduction in average yield. SW winter wheat production is centralized in the Pacific Northwest (PNW) states of Idaho, Oregon and Washington. As of May 14, 71 percent of Idaho SW, 80 percent of Oregon SW and 85 percent of Washington SW was rated in good to excellent condition.

Desert Durum®. USDA expects Desert Durum® production — centralized in Arizona and California and planted in the winter — to total 332,000 MT, up 6 percent from 2017/18 due to significantly better yields in California. In Arizona, the Desert Durum® crop was 90 percent headed by April 29, significantly ahead of the year prior’s pace.

Spring wheat and Northern durum. Snow covered, frozen fields delayed spring wheat and Northern durum planting this year, but U.S. farmers are beginning to catch up. As of May 14, spring wheat and durum planting is 58 percent complete, up from just 30 percent complete the week prior, but still behind the 5-year average pace of 67 percent.

With spring planting still underway, USDA did not provide a by-class breakdown of production for hard red spring (HRS) and durum on May 10. However, USDA did note that combined spring wheat and Northern durum production is projected to increase 34 percent year over year due to “both increased area and yield.” With total U.S. wheat production projected at 49.6 MMT and U.S. winter wheat production projected at 32.4 MMT, that puts 2018/19 spring wheat — including soft white spring, HRS, and hard white spring — and durum production at 17.2 MMT.

Back on March 29, USDA projected U.S. HRS planted area at 12.1 million acres (4.9 million hectares). If farmers are able to realize their planting intentions despite the late start, that would be up 17 percent year over year. Northern durum planted area was forecast at 1.88 million acres (760,000 hectares), down 14 percent, if realized. Still, weather will play a role in farmers’ decisions, and a late spring in Montana and western North Dakota tends to favor increased wheat area. Conversely, it tends to favor increased corn and soybean acres in Minnesota.

To stay in touch with U.S. wheat harvest progress, subscribe to the U.S. Wheat Associates Weekly Harvest Reports, which will start later this month.

*In the May 10 report, USDA combined data for soft white winter wheat and hard white winter wheat. Both soft white (SW) and hard white (HW) can be grown in either the spring or fall. USDA will provide a wheat by-class outlook in July. Similarly, data for HRS, SW spring, HW spring and spring-planted durum were combined into a general “spring-planted wheat” category.

May 17, 2018/by actualize

Hard Red Spring, Hard Red Winter, Hard White, Market and Crop Analysis, Northern Durum, Soft Red Winter, Soft White, Stephanie Bryant-Erdmann, Supply and Demand, Wheat Production and Harvest

As Always, Weather Is the Wildcard for U.S. Wheat Planting and Production

By Stephanie Bryant-Erdmann, USW Market Analyst

According to the March 29 USDA Prospective Plantings report, U.S. total spring-planted area will jump to an estimated 14.1 million acres (5.71 million hectares), 12 percent above 2017/18, if realized. The estimate includes 12.1 million acres (4.90 million hectares) of hard red spring (HRS), up 17 percent from 2017, if realized. It is important to note that this is an estimate, as farmers in the top four HRS producing states of Minnesota, Montana, North Dakota and South Dakota have not started planting due to extremely cold, snowy weather across the region.

USDA expects a 1.05 million acre (425,000 hectare) increase in North Dakota spring wheat area, which is forecast at 6.40 million acres (2.59 million hectares). If realized, that would be up 20 percent year over year. Spring wheat acres in Minnesota are also expected to increase 38 percent from 2017/18 levels to 1.6 million acres (648,000 hectares). South Dakota 2018/19 HRS planted area is forecast at 1.05 million acres (425,000 hectares), up 80,000 acres (32,000 hectares). However, the planting window for spring wheat in North Dakota and Minnesota is no more than three weeks; after that the yield potential starts to decrease and farmers choose to plant alternative crops.

“This cold, wet spring could work against spring wheat planting in eastern North Dakota and western Minnesota,” said Mike Krueger, an independent market analyst based in North Dakota. “Farmers in these areas are reluctant to plant spring wheat after late April and right now the forecast is calling for another two weeks of cold weather and snow. If planting is delayed until May, we will probably see a switch to soybeans or other crops.”

USDA forecast Montana HRS planted area at 2.50 million acres (1.00 million hectares), in line with 2017/18 planted area. But, in contrast to eastern North Dakota and western Minnesota, the late spring may increase HRS planted acres in parts of Montana according to Cassidy Marn, marketing program manager with the Montana Wheat & Barley Committee.

“Farmers in Montana have fewer alternatives and, since we can only grow limited quantities of corn and soybeans here, wheat tends to be the last alternative,” said Marn. “Planting peas and lentils is possible, but given the amount of snow we still have on frozen ground, some farmers could miss the window for those crops. Planting spring wheat in June is not ideal, but it is preferable to planting nothing.”

USDA expects U.S. durum planted area to total 2.00 million acres (809,000 hectares), down 13 percent from 2017/18, if realized. The predicted decline is driven in large part by USDA’s expectation that North Dakota farmers will switch from durum to HRS or oilseed crops due to lower returns on durum in recent years. In addition, growers near the border are frustrated by a large volume of durum freely crossing the border from Canada that increases pressure on durum prices. Weather conditions will also affect durum planting decisions.

USDA also updated the winter wheat planted area from its January 2018 estimate, increasing winter wheat planted area by 50,000 acres (20,000 hectares) to 32.7 million acres (13.2 million hectares). The new estimate is still 2 percent below the 2017/18 planted area. The increase came from hard red winter (HRW) area, estimated at 23.2 million acres (9.39 million hectares), up slightly from the previous projection, but still 2 percent below the year prior and 17 percent below the 5-year average.

The decreased HRW planted area makes crop conditions even more crucial. The April 2 USDA Crop Progress report rated 10 percent of Kansas HRW, 9 percent of Oklahoma HRW and 17 percent of South Dakota winter wheat as good, with virtually none of the crop rated as excellent in those states.

Soft red winter (SRW) planted area decreased from the previous estimate to 5.85 million acres (2.37 million hectares), but is still 4 percent above 2017/18 planted area. Overall, conditions for SRW are similar to what growers faced at the same time last year with a majority of the crop rated in good to excellent condition.

USDA expects white wheat acres — planted in both winter and spring — to reach 4.15 million acres (1.68 million hectares) for 2018/19, up 3 percent from 2017/18, but in line with the 5-year average. The U.S. Drought Monitor shows adequate moisture for Washington, but southern Idaho and Oregon are experiencing abnormally dry to moderate drought conditions. Still, USDA reported that the majority of the white wheat crop in those states are in good to excellent condition.

The expected increase in spring wheat area would increase total U.S. wheat planted area to 47.3 million acres (19.1 million hectares) in 2018/19, up 3 percent year over year. The increase was unexpected, but if realized it would still be the second lowest planted wheat area since 1919 when USDA records began.

As always, spring brings the waiting game — all we can do is watch how the crops respond to conditions going forward.

April 5, 2018/by actualize

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Annual Crop Quality Report and Seminars Will Help Customers Make Purchasing and Milling Decisions

USDA Confirms Ample U.S. Wheat Supply in 2018/19, Reassures Customers About Availability

Rain-Challenged 2018 SRW Crop Still Grades Above Average and Offers Performance Value

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Lower U.S. Wheat Futures: An Anomaly and Excellent Opportunity

USW Harvest Reports Now Posting Every Friday

Even with Lower HRW Outlook, U.S. Wheat Production Called Up for 2018/19

As Always, Weather Is the Wildcard for U.S. Wheat Planting and Production

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