Better protein could push 2018 wheat prices up
Wouldn't it be grand if Oklahoma wheat farmers could get $5 per bushel for their crop next spring?
Kim Anderson, Oklahoma State University Extension grain market economist, says that might be possible with better protein and test weights.
"Currently, the Kansas City July contract placed against the basis yields a price of right at $4 per bushel or just under for producers' 2018 wheat," he said. "If the right management decisions are made during the growing season, producers could potentially command $5 wheat come harvest."
Anderson backs up his claims by saying that while world wheat supplies are at record levels, the demand for high-protein wheat is good. If farmers can grow a crop delivering both high protein and high test weights, the price should go up.
"Planted acres are expected to be down this year, too" he said. "Some early estimates are putting total acreage of wheat at about 5 to 10 percent lower than last year- somewhat around 4 million acres the lowest since 1943 and 1918, going further back. But the acreage probably won't help much."
Anderson said the problem lies in Eastern Europe, where Russia and the Ukraine are producing tremendous amounts of wheat (nearly 3 billion bushels) and high-quality grain with an average protein content of 12.4 percent.
Those countries, he said, are cornering the protein market and absorbing export market sales, stealing them from the European Union, Australia, Argentina and the United States.
He advises farmers to stay the course and, most importantly, use good management to produce a high-quality crop.
U.S. farmers and ranchers will soon be receiving the USDA National Agricultural Statistics Service 2017 Census of Agriculture.