Kim Anderson Says "You're Either in the Wheat Business or You're Not"Thu, 27 Aug 2015 18:33:49 CDT
As farmers look to plant their wheat crop this fall, the price outlook isn't very rosy. On this weekend's edition of SUNUP, Oklahoma State University Grain Marketing Specialist Kim Anderson said basis right now is around 30 to 50 cents in Oklahoma. In looking at the July 2016 Kansas City wheat futures contract, prices are about $5.20, so local cash prices are ranging from $4.75 to $4.50.
For farmers with marginal land, Anderson recommends they evaluate their cost of production. Landowners may be better off in cash renting the land and contracting the crop, but Anderson wouldn't recommend forward contracting for harvest delivery right now.
While wheat prices are low, Anderson said they are getting closer to the bottom. His bottom cash price is about $4 a bushel in Oklahoma. With prices right now from $4.40 to $4.60, prices could go a little lower.
"You still plant that wheat, because the lower it gets, the higher the odds are that the price is going up," Anderson said. "It will go back up."
Oklahoma's five year average price is over $6 a bushel. SUNUP host Dave Deken asks Anderson, will prices get back above $6 by harvest 2016? Anderson isn't confident prices will get back to those levels anytime soon, but one caveat would be if Australia or Argentina had crop problems. Right now Australia is getting rain, so their production is actually increasing.
In looking back at 2010, wheat prices dropped to the mid-$3 range. Prices remained low in June, but by the end of August prices got back above $6.60. Anderson said it wasn't until the July -August time period, that it became much clearer how much lower wheat production was going to be globally. It wasn't until July, that wheat prices went higher and he thinks July will continue to be a critical month in gauging world wheat production and the outlook for wheat prices.
This week on SUNUP, we make our second stop of our 2015 fair series, as we come to you from the Payne County Free Fair in Stillwater. We start with insurance deadlines for planting canola with Eric DeVuyst.
-- Then, Josh Bushong has advice for producers planting canola and locations for the Canola Drill and Planter Calibration Clinics next week across Oklahoma.
-- In the Mesonet report, Al Sutherland shows us how wide of a temperature swing the state saw this week and one and three month forecasts. Producers should like what they see.
-- Also, Brian Arnall talks about nitrogen application windows for winter crops and has an option for getting urea under no-till ground.
-- Kim Anderson says "you're either in the (wheat) business or you're not," when asked if producers should plant with prices nearly $1.60 lower than the day the 2015 crop was cut.
-- In Cow-Calf Corner, Glenn Selk explains the three stages of calving.
-- Nurhan Dunford shows why antioxidants are important to the human diet.
-- Finally, we take a side trip on our 2015 fair series as we visit the Grady County Free Fair. They celebrated their centennial with some great events, including one called "Kid's Day."
Join us for 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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