After three consecutive record crops, the International Grains Council (IGC) expects world wheat production for the 2016/17 marketing year to decline to 713 million metric tons (MMT), down 3 percent from 2015/16. Unusually warm, dry weather constrained winter wheat planting in India, Ukraine and Russia, and an extended drought has hindered winter wheat productivity in Morocco, where IGC estimates a 40 percent decline in production year over year. According to USDA‘s March 31, 2016, Prospective Plantings report, U.S. wheat farmers also planted fewer winter wheat acres and intend to plant the smallest spring wheat area since 1972.
USDA estimated total U.S. planted area for the 2016 harvest at 49.5 million acres, down 9 percent from 2015 and 13 percent below the 5-year average of 57.3 million acres. The report reduced winter wheat planted area by an additional 390,000 acres from USDA’s January estimate to 36.2 million acres, down 8 percent from 2015.
USDA also updated its hard red winter (HRW) planted area estimate to 26.2 million acres, down one percent from the previous estimate. A delayed soybean harvest prevented some wheat seeding, and farmers decided not to plant as much wheat because cash prices were so low. If realized, HRW planted area will be down 10 percent from 29.0 million acres planted for 2015. Soft red winter (SRW) planted area also decreased from the previous estimate to 6.60 million acres with the biggest declines occurring in southern states. Farmers there have taken a hit three years in a row from untimely rains at harvest that hurt quality and resulting income.
USDA expects white wheat acres — planted in both winter and spring — to reach 4.02 million for 2016, down 3 percent from 2015 and lower than the 5-year average of 4.21 million. After three consecutive years of drought, much needed rain fell in the Pacific Northwest in December and January. However, the U.S. Drought Monitor shows dry conditions are developing again in Oregon, southeastern Washington and parts of Idaho where soft white (SW) production is centered.
The Drought Monitor also shows that Kansas and Oklahoma, which grew nearly half of the total U.S. HRW crop in 2015, are very dry. As of April 7, 2016, 93 percent of Kansas and 73 percent of Oklahoma were abnormally dry or experiencing moderate drought. In addition to the dryness, U.S. winter wheat growing areas are experiencing large temperature fluctuations. After falling below freezing on March 27 and April 1 to 2, temperatures reached 80°F in Texas, Oklahoma and Kansas this week.
However, the U.S. winter wheat crop is still in better condition than last year at this time. As of April 5, USDA rated the winter wheat crop at 59 percent good to excellent, compared with 44 percent at this time in 2015. USDA rated just 7 percent of the crop as poor or very poor, down from 16 percent last year.
“The wheat crop is developing two to three weeks ahead of schedule, which makes it extremely vulnerable to a late spring freeze, something that is not uncommon in Kansas,” noted Kansas Wheat Commission Vice President of Research and Operations Aaron Harries. “The wheat is in relatively good shape across the state, but we are really going to need rain here in the next few weeks. We’ve had a lot of wind and warm weather, which sucks the moisture out of the topsoil very quickly.”
The northern U.S. plains are also experiencing warm, dry conditions, which could allow farmers to begin planting early this year.
“We’ve seen some spring wheat planted already, and in the next week or two most farmers will be in their fields if the weather holds. It looks like it will be an early planting season again this year, which is good for wheat and could produce additional acreage,” said North Dakota Wheat Commission Marketing Specialist Erica Olson.
According to USDA, U.S. spring wheat planted area will decline to an estimated 11.3 million acres, 14 percent less than in 2015 and the lowest planted spring wheat area since 1972, if realized. The estimate includes 10.7 million acres of hard red spring (HRS), which faces strong competition from pulses and durum that have garnered higher returns this marketing year.
As Olson explains, “Other crops, especially peas, lentils and durum show higher returns than spring wheat, which makes them more favorable crops this year. Corn acres are expected to increase as well. These price trends are cyclical and next year a different set of crops will come out on top.”
USDA expects U.S. durum planted area to rise to 2.00 million acres, up 3 percent from 2015 despite a 28 percent decline in Desert Durum® area. USDA expects North Dakota farmers to plant 10 percent more acres to durum for 2016, which more than offsets the planted area loss in Arizona and California.
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