Associate Farm Editor, Reagan Calk, had the chance to catch up with Oklahoma State University Extension grain market economist Kim Anderson, and talk about the wheat markets and Oklahoma’s wheat crop.
As this year will mark year two of a short hard red winter wheat crop in Oklahoma, Anderson said the weather will get all the credit.
“We had problems putting wheat in the ground and we had problems in the growing season in Oklahoma, Texas, and Kansas,” Anderson said.
Oklahoma had a tremendous number of planted acres to start out with, Anderson said, but there were numerous troubles regarding growth.
“Just like prices, weather is unpredictable,” Anderson said. “We will know what we got when we get there. What we do know is that you are going to have bad years and you are going to have good years. In the good years, you have to prepare yourself financially with your equipment and your plans so that you can build up that nest egg for the last two years like we have had this time.”
This time last year, Anderson said wheat was over ten dollars.
“This year, we have had to opportunity to forward the contract at $8.50-$8.60,” Anderson said. “Right now, it is a little over eight dollars. It may go a little lower, but we are still going to have the upper sevens to lower eights for prices.”
Anderson also talked about how the global wheat harvest impacts prices in Oklahoma.
“Where we have had two bad years in a row, the world has had two record crops in a row,” Anderson said.
When it comes to around the world, Anderson said there is an adequate amount of wheat to meet demand.
“Stocks are tight, and our prices will stay relatively high, but Oklahoma is less than one percent of the world’s crop,” Anderson said. “The U.S. is ten percent of world export now. Russia, Ukraine, and Kazakhstan are almost 50 percent of exports.”
The price of wheat, Anderson said, is going to be determined in the Black Sea area due to their abundance of production overall.
Anderson advises producers to always sell their wheat at harvest.
“Another thing they should do if they are not selling off the combine, is they should set price targets,” Anderson said.