Fundamentally Speaking

Joel Karlin
DTN Contributing Analyst

U.S. winter wheat conditions improved slightly over the past week, up 2% in the combined good to excellent categories though at 36% this is still one of the worst rated crops in memory.

Much of this has to do with the devastating drought that has plagued much of the Great Plains over the past few years.

This has adversely affected the condition of the hard red winter (HRW) crop to a much greater degree than the soft red winter (SRW) variety grown in the Midwest or the white winter seeded in the Pacific Northwest.

The question we ask is whether the crop is so much behind the eight ball that even good growing weather here on out will result in a substantial improvement in both crop conditions and expected yields.

Using our usual system where we weight the crop based on the percent in each category and assign that category a factor of 2 for VP, 4 for P, 6 for F, 8 for G, and 10 for EX and then sum the results we calculated the first crop condition report of the spring.

Also plotted was the final yield as a percent of the 25 year trend and the harvested to planted ratio.

This year’s first spring crop rating at 598 as mentioned is one of the worst ever posted for that date. We looked at data from 1987 to 2012 and used only the poorest years, which were those that had a rating of 623 or worse, that is one standard deviation below the average.

There were five such years including 1989, 1996, 2002, 2006, and 2011 where the average first spring crop rating was 580, the harvested to planted ratio was 75.9%, and yields were 5.9% below trend.

This does not promise very good production so we then threw in a couple of other years that were not as bad including 2001 with a first crop rating of 646 with final yields 1.5% above trend.

Also included was 2009 with a first spring crop rating of 634 that resulted in a harvested to planted ratio of 79.6% and final yields 3.5% below trend.

The average of all seven was a crop rating of 597, almost exactly this year’s figure that resulted in a harvested to planted ratio of 76.4% and a yield 5.5% below trend.

With this year’s winter wheat seedings pegged at 41.988 million bushels and a trend yield of 47.0 bushels per acre, this could result in a crop of 1.425 billion bushels.

(KA)