What is in this article?:
- 2011/12 wheat marketing year average price $7.50
- Weather factors
- Wheat price average could top $7.50
- Volatility always an issue
- Drought conditions may have an effect
The 90-day precipitation forecast is for below-average rainfall in all of the hard red winter area except Oklahoma (not including the panhandle) and the area north of the Nebraska/South Dakota east-west line. Except for the extreme southern portion of the soft red winter wheat area, average precipitation is forecast.
The 90-day temperature forecast is for above average temperatures in all the hard and soft red winter wheat areas except for an east/west band along the Kansas/Nebraska border on the south and the Nebraska/South Dakota line on the north.
Even with average rainfall, above-average temperatures and the current drought conditions make average yields unlikely.
On the negative side, world wheat production is expected to increase in 2011/12. Wheat exports are projected to be 12 percent less than last year.
Corn planted acres are projected to be between 91.5 and 92 million acres compared to 88.2 million acres last year. The 2011/12 marketing year ending stocks are projected to be 865 million bushels compared to 675 million bushels in 2010/11 and 1.7 billion bushels in 2009/10.
If wheat production is lower than currently expected, wheat prices will probably be higher than expected and vice versa. This should reduce some of the anxiety about yields.
Producers need to concentrate on producing a quality product, following a marketing plan and managing their finances. Within the next three years, having cash on hand may be the most important component of farm survival.