Wheat farmers are considering variety selection, rotation options and marketing as they begin to get ready to plant the 2014 wheat crop.
It’s time to plant wheat. Some areas are too wet, some are too dry, and some are just right. It’s like an Indy 500 – the equipment is tuned up and everything is being put in place; producers are just waiting for the signal to start.
The first thing most producers want to know is: “What are prices going to do?” This is followed by: “How is the soil moisture?” “What is the weather forecast?” “What varieties should be planted?” “Based on weed and disease concerns, what management practices are needed to break the cycles?” “Should a wheat/canola crop rotation be used?”
Wheat may be forward contracted for June 2014 delivery for about 50 cents less than the Kansas city July 2014 wheat contract price. At this writing, the Kansas City July wheat contract price is $7.10. This indicates a June 2014 wheat price of $6.60. There is a good chance that the June 2014 central Oklahoma and Texas Panhandle wheat price will be $6.
In the August USDA WASDE (World Agricultural Supply and Demand Estimates) report, 2013/14 marketing year U.S. wheat ending stocks were projected to be 551 million bushels. This is down from 718 million bushels in 2012/13 wheat marketing year and below the five-year average of 791 million bushels.
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World wheat ending stocks were projected to be 6.4 billion bushels. This is the same as for the 2012/13 marketing year and below the five-year average of 6.9 billion bushels.
U.S. and world wheat stocks are projected to be adequate but below average. This sets the stage for the June 2014 wheat price. Above average production, depending on how much above average, may result in a below average June price. The average June wheat price in Oklahoma and the Texas Panhandle is about $6.50.
However, below-average wheat production could result in well above-average prices. The $6 prediction is based on above average production. Well below average production could result in prices being near $8.
The NOAA Climate Prediction Center shows that drought conditions still exist in extreme western Oklahoma, the Oklahoma and Texas Panhandles, western Kansas and up through Colorado into Montana. The 90-day forecast is for average temperatures across the entire hard red winter production area. Above-average precipitation is forecast for a line east of western Oklahoma (excluding the Oklahoma Panhandle) and up through central Kansas. Average precipitation is forecast for all other areas.
The 90-day forecast supports planting and establishing the 2014 U.S. HRW wheat crop. Above-average precipitation may hinder soft red winter wheat planting in Missouri and the Mississippi River region. Moisture may delay planting by delaying the soybean harvest and prevent field work after the harvest is completed.
Both Oklahoma and Texas Cooperative Extension services have recently released wheat variety test results that may be used to select wheat varieties to match soil conditions, potential disease problems, and production goals. Prudent producers utilize these resources.
Rye, oats, cheat, and other weed infestation is a continuing, if not growing problem. The problem is compounded with mono-cropping wheat (no crop rotation).
Two potential solutions are rotating wheat and canola, or using a Clearfield wheat variety combined with sound herbicide management.
Oklahoma Cooperative Extension canola enterprise budgets estimate operating (variable) costs to be about $225 per acre. At 1,600 pounds (16 hundredweight or 32 bushels) production and a projected June 2014 canola price of $18.20 per hundredweight ($9.10 per bushel), the gross return would be $291 per acre. The net would be $66 per acre and a much cleaner field.
Planting conditions are projected to be better than last year. Production for 2014 is projected to be higher than 2013. June 2014 prices are projected to be lower than June 2013 prices.