Worst wheat crop since 1957 could cost Oklahoma economy nearly $1 billion
Like assessing car damage after hitting a deer, Oklahoma hard red winter wheat growers readying themselves for harvest can't bear to look at the yield monitors. They know the damage is bad.
Following a very dry growing season, a frost, and insect pressure, the prospects for this year's wheat crop are the worst in 50 years, according to Oklahoma wheat industry experts.
Oklahoma's five-year wheat production average is 140 million bushels. On Friday, the USDA estimated the 2006 crop at 68.2 million bushels.
If realized, that would be Oklahoma's worst crop since 1957.
Paul Jackson, a southwest Oklahoma wheat grower, said his farm will yield only one third of what it normally does.
"Around here, 25 to 35 percent of the crop has been turned over to crop insurance with yields averaging between 0-6 bushels per acre," Jackson said. "What crop is left will yield between 15-20 bushels per acre."
Historically, in an eight-county area in southwest Oklahoma, growers average 38 bushels per acre.
Meanwhile, the result of a very short crop is expected to have a rippling affect beyond growers, Anderson said.
Dr. Kim Anderson, Oklahoma State University farm economist told Agriculture Online that it's a depressed situation for Oklahoma's entire wheat sector.
"I just returned from southern Oklahoma, the hardest hit area, where the elevator operators are hoping to get just 10 percent of the wheat they took in last year," Anderson said. "From the loss of income to the producers, elevators, and farm agribusiness sector, it's a devastating year."
Anderson said the elevators' income will be cut in half, and very few custom harvesters will be needed this year.
"I've heard of producers haying their wheat, and only getting half a bale. They are putting 72 feet of wheat in a windrow and still not having enough for a full-sized bale," Anderson said.
Using this week's wheat futures prices at an average of $4.40 per bushel, while considering yields at 70.0 million bushels below average, that equates to a $280 million loss to growers.
"If you take into account the economic multipliers, we could see a loss to the Oklahoma economy of $924 million. That's lost income to the state of Oklahoma," Anderson said.
So, what happened to this year's crop agronomically? Mark Hodges, Oklahoma Wheat Commission executive director, said that dry conditions thwarted any development of roots for the plants.
"In a lot of cases, no rain fell from October to March," Hodges said. "When we finally got some rain, the plant couldn't take maximum advantage of it because there was no root system to draw from."
To make matters worse, the more stress you put wheat under, the more susceptible it is to diseases like root rot.
"So, few tillers caused short wheat heads which produced less berries," Hodges said. "This is a recipe for a smaller wheat crop than you normally produce."