Kim Anderson Explains the Fundamental Change That's Occurring in the Global Wheat MarketThu, 25 Apr 2019 17:51:57 CDT
Grain prices continue to decline as offers for forward contracting wheat at harvest delivery fell below $4.00 this week. The most producers can hope to forward contract their wheat for at the present time is somewhere between $3.95 and $3.97. This week on SUNUP, Oklahoma State University Extension Grain Market Economist Dr. Kim Anderson joins host Lyndall Stout to compare the current market to how it looked back in February of this year.
According to Anderson, the forward contract price then was about $4.90. Since then, prices have dropped roughly a dollar. Anderson says previous expectations for what the Russians had coming into the year in terms of exportable wheat were just simply wrong. Near the end of last year, the trade anticipated that Russia would exhaust its supplies by January or February of this year and give the US and opportunity to command more of the market. Fast-forward to today and Russia is still marketing wheat with what looks to be yet another massive crop coming down the pipeline.
The fact that the market value of the USD has increased has not helped the situation either, making US wheat more expensive. In addition, Anderson says wheat production around the world is flourishing, even in nontraditional wheat producing countries. This has led to more competition in the marketplace and reduced the overall export demand worldwide.
Anderson says there has essentially been a fundamental change in the global wheat market as the Black Sea Region's influence has grown and as Third World importers have managed to significantly increase their production. The combined impact of these events has dulled the US wheat industry's competitive edge.
As producers look toward the future, Anderson says quality will be the determining factor that dictates any price improvement.
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 how insects are impacting winter crop growth from Tom Royer.
- Then, we travel to Grant County for the second stop on the canola tour across northern Oklahoma.
- In the Mesonet weather report, Wes Lee shows us how the soil profile is reacting to the recent moisture. Gary McManus says the rain this week prevented a return to abnormally dry conditions across the state.
- Bob Hunger says wheat rusts may have jumped from southern Texas to southern Kansas, but don't give up on scouting for rust.
- In Cow-Calf Corner, Glenn Selk explains the importance of timing artificial insemination for a successful pregnancy in cattle.
- Finally, Kris Hiney shows us why it is important for emergency responders to learn how to work with scared and excitable livestock.
Join us for SUNUP:
Saturday at 7:30 a.m.
Sunday at 6 a.m. on OETA-TV
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