Kim Anderson Finds the Bottom for Wheat PricesThu, 10 Sep 2015 19:24:52 CDT
If farmers still have grain in the bin, wheat prices look pretty grim. Wheat prices have been trending lower since July 2013 and prices have been on a steady decline since harvest. On this weekend’s edition of SUNUP, Oklahoma State University Grain Marketing Specialist Kim Anderson said right now the September Kansas City wheat futures contract is around $4.77 with the Oklahoma cash price around $4.30 a bushel. In watching the September contract, he said it has support around $4.60 with strong support at $4.50 and resistance at $4.80. In looking at the long term trend of wheat prices, Anderson said the bottom is nearing.
“If you look at wheat prices on the KC contract over the last 15 years, there’s a floor at about $4.30 on the futures contact,” Anderson said. “I’ve got my bottom at $4.50, so we could pop the $4.50, go down and bounce off $4.30.”
In looking at where wheat prices are headed, Anderson said a lot will depend on the Australian and Argentina wheat crops. In past years, he said wheat prices have moved sideways until a factor can move prices off the bottom. With three record world wheat crops in a row, global ending stocks also look to be record setting.
In exporting the wheat crop, Anderson said the U.S. will have to become more price competitive. Canada and Australia will need to continue to export wheat and once their supplies get lower, he said their wheat prices will increase. That will help the U.S. become more price competitive on the global market, plus there is the difference in quality. The U.S. has a good bread milling quality product, which is good for exports. Anderson said the quality of the crop and lower prices is helping the U.S. get some wheat sold right now, along with the relationships with wheat buyers around the world.
This week on SUNUP, we make the fourth stop for our 2015 fair series at the Garvin County Fair in Pauls Valley. We start with advice from Extension Small Grains Specialist Jeff Edwards concerning Plant Variety Protection (PVP) laws and purchasing, selling or cleaning wheat seed.
-- Then, John Weir explains the results of a survey of prescribed burn associations across the Great Plains.
-- In the Mesonet report, Al Sutherland and Gary McManus have a regional look at the growing drought and how recent rains may help some of the hardest hit areas.
-- Kim Anderson tells us how close we could be to the bottom for wheat prices and how long it could last.
-- In Cow-Calf Corner, Glenn Selk explains how the length of weaning can impact calf health.
-- Next, Gant Mourer reminds us that weaning dates are approaching for cattle enrolled in Oklahoma Quality Beef Network sales.
-- Finally, we see how important volunteers are to the Garvin County Fair, which is marking its centennial.
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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