Agricultural News
Markets Taken by Surprise as Wheat Prices Unexpectedly Fall 70 Cents- Kim Anderson Explains Why
Thu, 28 Feb 2019 23:27:18 CST
Once again this week, wheat prices fell another unexpected 70 cents leaving speculators wondering what happened and why this was not foreseen. SUNUP Host Lyndall Stout is joined this weekend by Oklahoma State University Extension Grain Economist Dr. Kim Anderson, who will try to explain the causes behind this surprising turn of events in the markets.
In a preview of this week's interview, Anderson remarked that the sudden drop in price was probably in reaction to new information that has finally started to trickle in since being delayed by the government shutdown. He explained that with a lack of information, the market has been led blindly. With the flow of relevant information finally catching up, the market has suddenly had to correct itself to reflect the current situation that has just now become clear.
Anderson says that situation has been made clear by a combination of things. For instance, the recent USDA crop conditions report was released this week, indicating much better conditions in this year's wheat crop compared to last year's. In addition, favorable weather conditions are expected which can be interpreted as reasonable chances for higher yields. Furthermore, the market fears that export demand will not be as robust as it needs to be with USDA anticipated at least a 15 percent lag in business this year and India coming on line soon with a record harvest that will occur just before our own harvest, putting more grain on the market.
However, despite these many concerns, Anderson says for Oklahoma producers the reality of the situation is much less ominous as 90 percent of the wheat here in state has already been sold.
Anderson says it is always a good idea to weigh your options as you decide on whether or not to harvest or potentially graze out your crop this year. He suggests starting with the forward contract price to begin those calculations in figuring the most profitable strategy which currently is running 15 under basis on the July contract at $4.43.
You can watch their visit tomorrow or Sunday on SUNUP- but you can hear Kim's comments right now by clicking on the LISTEN BAR below.
Beyond Lyndall's weekly chat with Dr. Anderson- the SUNUP crew has a very full lineup for your viewing this weekend:
This week on SUNUP, we learn some early information about the 2018 Farm Bill from Amy Hagerman and what it could mean for crops already in the ground.
- Then, Derrell Peel says the colder weather across the country is having a dual impact on cattle markets.
- In Cow-Calf Corner, Glenn Selk explains the best way to warm a severely cold newborn calf.
- Kris Hiney and Larry Sanchez show us how to fit a horse for riding.
- In the Mesonet weather report, Wes Lee compares current soil temperatures across the state to those from one year ago. Gary McManus says drought has reentered Oklahoma, but it likely won't stay long.
Join us for SUNUP:
Saturday at 7:30 a.m.
Sunday at 6 a.m. on OETA-TV
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