2016 HRW Wheat Tour - Day 2

By Pam Smith
DTN Progressive Farmer Crops Technology Editor

WICHITA, Kan. (DTN) -- It's hard to argue with big wheat production estimates when you're walking through near-perfect wheat fields. Scouts on the second day of the Wheat Quality Council's annual Hard Red Winter Wheat Tour found a surprisingly good crop Wednesday in the southern half of the state, which covered what are typically some of Kansas's driest regions.

Average yield for the second day of the tour was estimated at 49.3 bushels per acre based on 300 stops compared to 34.5 bpa last year. That brings the accumulative average yield estimate so far to 48.2 bpa for the 2016 tour. Scouts will continue to pull samples Thursday as they head back to Manhattan.

Scouts immediately found some picture-perfect fields as they headed south out of Colby. Fields were still muddy, but diseases were less evident than in the central portions of the state Tuesday. For the most part good yields continued to be found throughout the west-central district. Several veteran scouts commented on the unusual situation of seeing ponded water with ducks in some fields in southwest Kansas.

Philip Beeson, director of commodity services with Beeson & Associates, Inc., Louisville, Kentucky, said the consistency of the fields has struck him this year. "I've never been on this tour when we didn't have a field that we wrote off as a zero," Beeson said. "That's definitely not the case this year. It's going to be a big crop."

Some scouts dipped as far south as northern Oklahoma. Warm weather cranked the season up early in that state and some of the crop was too far along in crop development to really take advantage of April rains, according to Mark Hodges, Plains Grains, Inc. He also noted that stripe rust exploded in some areas when the rains and increased humidity did come.

"After last year when we had an epidemic of stripe rust, most producers felt like they needed to use a fungicide," Hodges said. "But at sub-$4 wheat, it's really hard to talk them into spraying." He estimated breakeven on dryland wheat in Oklahoma with no returns to labor or land is about $5 per bushel.

He also noted that some areas of southwest Oklahoma got 22 inches of rain in 30 days when the wheat was ripe last year. That hurt test weights and end quality and there are elevators that can't move that old, low-quality grain. "We need a crop [this year] and we need a quality crop," he said.

Hodges reported that Oklahoma planted 5 million acres of wheat for 2016 harvest and is expected to harvest 3.82 million. Wheat grazing has picked up this year because of the strength in the cattle market and weaker wheat market. Wheat in the state is expected to yield 33.6 bpa and production is estimated at 128.48 million bushel, based on a recent 530-sample survey. The most recent USDA Crop Progress report put Oklahoma wheat at 72% headed compared to a 73% five-year average and it was rated 65% good to excellent.

Kansas wheat scouts spotted plenty of airplanes spraying fungicides Wednesday as growers seek to hang on to the yield potential in the field. Yield variability was still a factor and day two yields ranged from 16 bpa to 107 bpa.

Several routes crossed through the areas severely burned from wildfires. Although fences and trees remain reminders of the devastation, the pastures are teeming with wildflowers and green grass -- proof of how restorative rain can be.

Beeson added that his company uses this tour as a good barometer for how long to set entry points into the wheat market. "We're going to be taking advantage of these prices and buying a lot of wheat over the next week or so," he noted.

The July wheat market fell to within a couple of cents of contract lows on news of what scouts were finding on Tuesday. Beeson said that didn't surprise him.

"The first day of this tour generally confirms or rejects overall market expectations," he said. "Buyers were expecting a good-looking crop and that is what the tour found over day one and two. I would expect we see limited near-term downside from here after the move lower on Tuesday. It is also interesting to look at the past two years and note that the contract high was set two years ago and low last year after the first day of the tour."

Thursday the wheat tour leaves Wichita for Manhattan, crossing through some of the largest and often most productive wheat counties in the state. The tour wrap up and final results are scheduled to be available by 11:30 a.m. CDT.

Pamela Smith can be reached at Pamela.smith@dtn.com

Follow her on twitter @PamSmithDTN

(CZ)

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