Kim Anderson Talks Wheat Market Volatility on This Weekend's SUNUPThu, 12 Jun 2014 18:45:56 CDT
Traders saw market volatility this week with the release of the latest World Supply Demand and Estimates and the latest Crop Production report and released from the US Department of Agriculture. In this week's preview of Saturday's SUNUP program, Oklahoma State University Extension Grain Marketing Specialist Kim Anderson provides insight to this week's reports.
"You can go back to last Friday, the Kansas City July wheat contact was at about $7.35 and it wallered around on Monday and Tuesday, slightly lower, but on Wednesday after that report we took about 31 - 32 cents off that (price) and closed around 7.04," Anderson said.
The lower prices are a direct result of the market, but maybe not as much as one might believe.
"There wasn't much in the report, they didn't change corn or soybean supply and demand estimates at all," Anderson said. "On wheat they made minor changes, slightly lower US production, slightly higher use, ending stock they increased by thirty four million bushels, that's a small increase."
The world supply of wheat didn't change much. Like the US, harvest is underway in several locations. If you look around the world, like India their harvest is pretty much over producing a record 3.51 million. Anderson says that's on top of a 3.44 million bushels last year.
Wheat harvest in China is approximately 30 percent complete producing 4.56 billion bushels. Anderson says that is also a record crop and that's on top of last year's 4.47 billion bushels.
The Russia and the Ukraine area looks to produce an average crop and Australia's production looks to be slightly below average crop but near the 10 year average,
With the down turn in the market, farmers are concerned about where the price is headed.
"The average price is about $6.50 and currently prices are up around 6.80 right now," Anderson said. "You can look at the range in prices over the last few years, its been from $3.50 to $9.00."
"So, I think that is the foundation they need to look at, Anderson said. "Look at last year and what prices and how volatile they were."
Looking ahead Anderson says farmers need to keep their eyes on the Kansas City July contact.
"Its critical at $7.00," Anderson said. "If its below $7.00 by next Tuesday we may get down to 6.80 or maybe even 6.60 on that KC contact."
"There's just a lot of uncertainty in this market right now," Anderson said. He recommends farmers sell one third of their crop at harvest, a third in September-October and the final third in the November December time period.
Click on the LISTEN BAR below to hear Kim Anderson's full report.
Also on this week's SUNUP show:
-In the Mesonet report, Al Sutherland examines wind speeds and how the recent rains improved the water available for plants at different soil depths.
-In Cow-Calf Corner, Glenn Selk examines the potential for nitrate toxicity exposure from summer annuals.
-Next, Angela Post offers advice on treating early summer weeds.
-In Naturally Speaking, Marley Beem has tips to manage duckweed and water willow in ponds.
-Randy Taylor and Wayne Kiner demonstrate a way to repurpose roller chain parts, in Shop Stop.
-Finally, Mark Johnson recalls the life and legacy of Robert "Bob" Totusek, the former leader of OSU's Department of Animal Science, who passed away last week.
Catch SUNUP: Saturdays at 7:30 a.m. & Sundays at 6 a.m. on OETA-TV or online at
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