The wheat market outlook has improved significantly following a challenging harvest across the Southern Plains, according to Oklahoma State University Extension grain market economist Dr. Todd Hubbs. Speaking with Senior Farm and Ranch Broadcaster Ron Hays, Hubbs discussed the latest USDA crop reports, grain markets, corn and soybean prospects, grain sorghum demand, and why producers should be watching for pricing opportunities in today’s volatile markets.
Southern Plains Wheat Crop Confirms a Difficult Year
Hubbs said the latest USDA Crop Production and World Agricultural Supply and Demand Estimates (WASDE) reports confirmed what producers already experienced in the field—a historically disappointing wheat crop.
“The acreage is down, harvested acreage being down, expected to go down—it went down a little more than I thought it would,” Hubbs said. “They keep dropping yield, and Kansas dropped yield again. They’re down to 33 bushels an acre. We’ve got a winter wheat production number less than a billion bushels now. It was a devastating crop for us here in the Southern Plains this year, and it’s all coming in through the data. I think we all thought that, and it’s being confirmed now.”
Despite the poor production numbers, Hubbs said wheat prices have responded favorably.
Global Events Fuel Wheat Rally
According to Hubbs, several international developments have strengthened wheat prices beyond the impact of lower U.S. production. “We got support from that July Crop Production report, and the WASDE was supportive because we saw some lower production around the world,” he explained. “They’re still concerned about the EU crop because they’ve had a heat wave as well.”
However, he said the biggest influence has been ongoing conflict in the Black Sea region. “What’s driving this over 50-cent move in KC wheat is the fight going on between Russia and Ukraine,” Hubbs said. “Russia’s hitting the Odessa port. Ukraine’s hitting stuff in the Azov Sea and the Kerch Strait. It’s that area where Russia moves about a quarter of their wheat crop.”
Those disruptions have pushed export prices higher and benefited hard red winter wheat markets. “We’ve just seen a really nice run for us here in Oklahoma on HRW price,” Hubbs said. “You’re up for $6, and depending on your protein level, you might touch seven on HRW right now. In general, I love this rally for our folks.”
Consider Pricing Wheat During the Rally
While pleased with stronger prices, Hubbs encouraged producers to think strategically about marketing grain while prices remain elevated. “If you should maybe start thinking about pricing some of this at this level, I don’t know how long this thing will go on or how it’ll spin out of control,” he said. “If you’re in the upper six or $7 range for your wheat, I don’t think anybody thought that four months ago.”
When Hays remarked that such prices once seemed unimaginable, Hubbs agreed. “It was,” Hubbs replied. “So I’d start giving a good thought if you’ve got wheat to sell.”
Corn Crop Showing Strong Potential
Turning to corn, Hubbs said conditions across much of the Corn Belt remain favorable despite summer heat. “In the heart of the Corn Belt… it sounds like the crop’s coming in pretty good,” he said. “We’re about to get into the heart of pollination, and how that all turns out is going to go a long way to determine this corn crop.”
Hubbs believes USDA’s current national yield estimate is reasonable. “I would probably put a base assumption on USDA’s 183 yield,” he said. “It could come in higher. Honestly, the models I’ve been running were a little bit higher than that nationally.”
He added that even Oklahoma’s dryland corn has shown encouraging potential. “Some of this dryland corn looks pretty good, depending on where you’re at,” Hubbs said. “If the heart of the Corn Belt comes through, it’s going to be a good crop.”
E15 Could Help Corn Demand—But Questions Remain
Hays asked whether nationwide year-round E15 could significantly boost corn demand. Hubbs acknowledged its potential but urged caution. “I don’t have a lot of faith it’s going to make it through Congress at this point,” Hubbs said. “I don’t want to get people’s hopes up that E15 is some silver bullet that can solve our problems.”
He explained that higher ethanol blends could increase corn use, but only if consumers actually adopt the fuel. “It would help, but it probably needs to be mandated. Just saying E15 is available isn’t going to make people pump it.”
Even so, Hubbs noted that stronger ethanol demand could consume nearly 900 million additional bushels of corn. “We’re still moving corn like crazy out into the global market at these low prices,” he said. “The world’s buying it, and I expect that to continue.”
Soybeans Continue to Benefit from Strong Demand
Hubbs said soybeans also appear to be in good shape despite localized moisture issues. “I think we’re pretty close to where USDA is calling it in that 53-bushel acre range,” he said. “August and September will go a long way to determine what our bean crop looks like.”
Demand remains a bright spot. “We’ve seen unbelievable crush numbers,” Hubbs said. “We’re setting record crush pace. I expect soybean oil used for biomass-based diesel to kick up more as they try to meet the mandate.”
He also expects China to remain an important customer for U.S. soybeans. “I have no reason to doubt that China is going to buy 25 million metric tons, which is what they normally buy from us,” Hubbs said.
Like wheat, he believes soybean producers should watch pricing opportunities. “When we see that soybean price around $12, I think people would have bit your hand off to get it not too long ago,” Hubbs said. “Maybe give it some good consideration if we get up around that number again.”
Grain Sorghum Depends on Export Demand
With Oklahoma planting more grain sorghum this season, Hubbs said exports—particularly to China—will be key to maintaining competitive prices. “When we get a good run on sorghum price… we need that export market to be there, and that’s a China market,” he said. “I expect that to be there.”
He also noted ethanol production has quietly become another source of demand. “Hidden in all the data out there is we’ve been grinding quite a bit of sorghum for ethanol production—about 10 million bushels a month,” Hubbs said. “It doesn’t sound like a lot, but it adds up on the sorghum crop.”
Looking Ahead to Next Year’s Wheat Crop
As producers begin planning fall planting decisions, Hubbs believes wheat acreage could increase modestly if prices remain attractive. “I think we might see more acres than we did last year,” he said. “If we can keep these prices up a bit and get a little run, it’s going to be competitive.”
Still, he acknowledged the uncertainty producers face. “These are tough times, Ron, and they’re tough decisions to make on what you plant,” Hubbs said. “When things are uncertain, people sort of go to the status quo and plant what they know.”
Volatility Creates Opportunity
Hubbs closed the conversation with a reminder that today’s grain markets are moving quickly, making timely marketing decisions increasingly important. “Just keep your eyes on the market,” he said. “It’s crazy volatility these days, and when you get these big rallies, it’s an opportunity. It’s an opportunity.”
As Hays cautioned that opportunities can disappear quickly, Hubbs agreed with a final reminder to producers: “It can go away in a heartbeat.”
