Agricultural News
Kim Anderson Analyzes Wheat Price Trends
Thu, 18 Sep 2014 19:13:09 CDT
The outlook for wheat prices is showing more downward potential. Oklahoma State University Grain Marketing Economist Dr. Kim Anderson said between now and May 2015 the nearby Kansas City Board of Trade nearby contract wheat price could get down to $4.25/bu. He is basing his outlook on the 2008 - 2009 marketing year and 2009 -2010 marketing year price trends and current corn price trends.
"If you look back at '08 and '09 the stocks to use ratio was somewhere around 28 - 29 percent," Anderson said. " In '09 - '10 it increased to up over 40 percent. Right now our stocks to use ratio is around that 27 - 28 percent and next year if we get this wheat planted good, we got moisture, looks like we're having a big crop, then we could follow the same price patterns or near the same patterns as we followed back in '08 - '09 and '09 - '10."
Next year's harvest will determine the outlook for prices. On OSU's SUNUP TV program Anderson said he has been predicting a cash price at $5.50 with a futures price at $6/bu. He said he is looking to lower that futures price down to around $5.50 and it could be as low $4.75. With a short crop the price could go as high as $6.25
If the US produces a large wheat crop coupled with a large world wheat crop, Anderson said then wheat prices could head down to $4.50 on the Kansas City wheat futures contract. In taking 50 cents off that price for the cash price farmers are looking at about $4/bu.
This fall and winter farmers will be beginning signing up for Farm Bill safety net programs. Under the 2014 Farm Bill, farmers will sign up and lock themselves into one program for the duration of the Farm Bill. Anderson said lower prices are going to support Price Loss Coverage program over the Agriculture Risk Coverage programs.
You can see their full conversation on SUNUP this weekend on OETA across the state of Oklahoma- or you can listen to Dr. Anderson's current wheat market analysis right now by clicking LISTEN BAR at the bottom of this article.
This week on SUNUP, we check in with Jeff Edwards on the progress of wheat planting in Oklahoma.
-Jody Campiche has reminders about upcoming crop insurance deadlines, and explains the differences between the PLC and ARC programs.
-Al Sutherland shows us recent soil temperatures and moisture levels and has an overview of forecasting tools on the Mesonet website.
-Next, Shannon Ferrell breaks down the recent controversy involving the EPA and waters of the U.S.
-In Cow-Calf Corner, Glenn Selk looks at the health benefits of weaning calves at least 45 days prior to marketing.
-Then, Kim Anderson analyzes how projections for continued low wheat prices could potentially impact farm bill program decisions.
-In Shop Stop, Randy Taylor and Wayne Kiner explain what "feet of head" means in relation to pumps.
-Finally, we return to the USDA research station near El Reno, the headquarters for a $10 million integrated research and Extension project for the southern plains region. This week, our focus is on powerful new technology for soil moisture research. Interviews include Tyson Ochsner and Patrick Starks.
Catch SUNUP:
Saturdays at 7:30 a.m. & Sundays at 6 a.m. on OETA-TV
Catch SUNUP online through the OSU website by clicking here or through YouTube by clicking here.
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