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Agricultural News

OSU's Kim Anderson Dsicusses the Prices Abroad that are Restricting Prices Locally

Thu, 03 Oct 2019 18:10:40 CDT

OSU's Kim Anderson Dsicusses the Prices Abroad that are Restricting Prices Locally

In his weekly visit with SUNUP host Lyndall Stout this weekend, Oklahoma State University Extension Grain Market Economist Dr. Kim Anderson talks about the prices abroad that are causing the issues here in the Oklahoma wheat market.    

“I got excited when the KC December contract closed two days in a row above $4.10/bu,” Anderson said. “I said if it breaks that we are going to continue this short run up trend. But it lasted those two days, then it crashed back down below it. Its down around $4.00/bu now.”   

Anderson says he thinks the December contract price dropped due to prices in the Black Sea Region. Ukraine offered wheat FOB at about $200 a metric ton, which comes out to about $5.50/bu. At that price with the shipping cost to get it to the ports and across the ocean, prices in Oklahoma would have to be about $3.65/bu to compete with the BSR, he added.    

“Finally, somebody’s undercutting Russia and Ukraine prices,” He said. “Your talking about 660 million metric tons, and that is wheat that Russia and Ukraine haven’t sold yet. And they are going to sell that into our markets, and take some of our market.”   

France sold their wheat to Egypt for $199 a metric ton. If you take away the freight cost to New Orleans the price would be $4.95/bu. But their price on soft red winter wheat in New Orleans is priced at $5.50/bu, and Anderson says it is priced out of the market.   

“There is some hope, but its very little,” Anderson said. “We have some production problems and quality problems in North Dakota and Canada with the spring wheat. Australia has problems with their wheat production, but that’s already priced in the market.”

Join us for SUNUP:
Saturday at 7:30 a.m.
Sunday at 6 a.m. on OETA-TV



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