Trading after the wheat tour
It was an active week in the grain complex. Wheat had the Kansas tour going on and yet another freeze, corn had Mother Nature wreaking more havoc with cold, rain, and snow while soybeans had cancellations and then big new-crop sales.
The wheat tour poured over Kansas with the goal of quantifying this year’s production, but slow crop development and multiple freezes made that job very difficult. While acknowledging that the formulas they had to use would likely make their estimates too high, they nevertheless reported what they saw.
Total Kansas production was projected at 313 million bushels on a 41.1 bpa. Average production estimates of the last several years is 341 million. They assumed an 18% abandonment rate, the highest since 1996. Western and southwestern Kansas looked the worst, no surprise, and the estimated yields would be achieved only if the rains came. The western Plains still are extremely dry.
In central Kansas, however, the crops looked much better, and trade sentiment seems to be that the good yields there will largely offset western losses.
However, another record-cold morning on Friday brought freezing temps through much of central Kansas down deep into the Texas panhandle. The wheat that hadn’t already been killed certainly was set back again. The general sentiment now is that we'll have to wait until harvest to really know the extent of the damage.
Oklahoma estimated their wheat production at 86 million bushels, down 46% from last year. Colorado put out an estimate of 34 bpa and Nebraska is estimating 30 bpa, down 27% from last year.
Informa released an updated winter wheat estimate on Friday, taking hard red down 52 million bushels from their previous estimate, now standing at 798 million bushels. Soft red was lowered just 1 to 508 million and white wheat left unchanged at 222 million bushels.