North American Winter Wheat Conditions Far From Ideal, Output Declining

Wheat crops in North America are seen emerging from winter dormancy faced by what might be described as some very challenging conditions.

In Kansas dryness has intensified since December 1st in the leading US wheat state. Southwest Kansas is driest having received less than 20% of normal rainfall, while central Kansas has fared little better getting only 33% of normal moisture. Strong warming in February is coaxing wheat out of dormancy, creating a strong need for rainfall. In La Nina winters, the subtropical jet stream is suppressed, leading to fewer storms in the Southern Plains.

Oklahoma wheat farms are very dry. Conditions have declined here in the nation’s second biggest wheat state in a very dry winter. A moderate drought a month ago has become severe in the panhandle and southwest wheat districts, where only 25-30% of normal rainfall has been received since November 1st.

In Texas wheat conditions in the good to excellent category are just 12%, while the poor-very poor category is running at 58%. Condition ratings are similar to 1989, 1996, 2000 and 2006 – the worst production years in Texas history. More than half of the sown area was abandoned due to drought in each of those years. Seventy two percent of the crop was lost in 2006.

Canada’s western wheat provinces are also dry. Western Saskatchewan and eastern Alberta have received less than half of normal precipitation since September 1st and need generous spring rainfall for planting. The Canadian Wheat Board predicts a 16% cut in wheat production in 2009, due to depressed prices that encourage smaller plantings in the global economic downturn. They are also calling US production 15% lower in 2009 for similar reasons.

Canadian all wheat production will fall to 23.9mmt from 28.6mmt in 2008, whilst US output will drop to 57.8mmt from 68.0mmt last season, they say. Meanwhile world production will decrease 50mmt to 633mmt they predict.