Agricultural News
Anderson Urges Farmers to Capture Gains in Wheat Prices Right Now
Thu, 25 Jun 2015 18:13:16 CDT
Wheat prices got a bounce this week. On this weekend's edition of SUNUP, Oklahoma State University Grain Marketing Specialist Dr. Kim Anderson said the bump in the price came from the funds buying wheat contracts.
"Over the last couple months, at one time they were short 111 - thousand contracts, they're probably short 30 to 40 thousand now," Anderson said. "They've been buying to get out those short positions. You buy the market, price goes up. I think the funds are what's driving prices now."
Anderson said the funds are buying contracts, because they have concluded wheat prices are moving sideways to slightly higher, so they wanting to get out of their short positions and get whatever profit they can get.
SUNUP Host Dave Deken catches up with Anderson about the wheat market. Click or tap on the LISTENBAR below to listen to the full interview.
Traders are also watching how El Nino will effect wheat production globally. Anderson said Argentina has been dry during the planting season, so acres look to be lower. If El Nino holds, Australia looks to have lower wheat production and exports next year. China has had too much rain, which is resulting in poor quality wheat. He said China looks to import twice as much wheat this year. If El Nino holds, then the monsoon rains will be weak and that will lower wheat production in India. It has also been dry in major wheat production countries like Russia, Ukraine and Kazakhstan. Anderson said all of those factors are driving forces for wheat prices.
In looking at the price outlook for wheat, Anderson said that won't be determined by U.S. wheat production. This year the U.S. is projected to produce eight percent of the world's wheat crop. Anderson said wheat prices will be set based on production from major wheat exporters like the European Union, the former Soviet Union countries and the Black Sea region. The price trend will be set in the late August to September time frame, when those regions are harvesting their wheat crop.
In marketing the 2015 wheat crop, Anderson typically recommends farmers sell one third of their wheat crop at harvest, one third in the September-October timeframe, then the remaining third in the November-December time frame. With this latest bounce in the market, he recommends farmers sell at least one third, if not more of their wheat crop at harvest.
This week on SUNUP, Jeff Edwards tells us how the Oklahoma wheat crop is faring as the last half of the state moves toward harvest.
-- Then, John Weir explains why this is the best time for prescribed burns.
-- Also, Jason Warren talks about the benefits of conventional till and no-till.
-- In Cow-Calf Corner, Glenn Selk explains how eye infections in cattle can negatively affect weight.
-- Kim Anderson shares what influenced the price rally in wheat and why the U.S. will produce only 8 percent of the world's wheat crop.
-- In the Mesonet report, Al Sutherland highlights the new "Wet Bulb Globe Temperature" feature on the Mesonet website and discusses rainfall totals for tropical depression Bill.
-- Finally, Nurhan Dunford explains trans fat and where it shows up in the American diet in Food Whys.
Join us for SUNUP: Saturdays at 7:30 a.m. & Sundays at 6 a.m. on OETA-TV
SUNUP can be seen on OETA across the state of Oklahoma- Dr. Anderson's segment on the markets is one of the standard features of this weekly show from Oklahoma State University. Catch SUNUP online through the OSU website by clicking here or through YouTube by clicking here.
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