A marketing warning for club wheat

Farm and Ranch March 23, 2009 Back in January here is what Washington Wheat Commission CEO Tom Mick said about the club wheat situation. Mick: "We are getting concerned whether we are going to have enough club to meet demand. We are of the opinion there is enough club out there but supplies are very tight." That continues to be a concern and the nearly $2 a bushel Portland premium for club wheat over soft white reflects the tight supplies. Now, despite the tight supplies Mick is warning that club premiums could disappear in the near future. Why? Well, the expectation that there are sufficient supplies to meet demand is based on continued farmer selling. Mick says if farmers don't sell exporters may stop offering bids for club wheat if they fear they can't draw enough grain from the country to meet tenders. In other words no cash market for club wheat. Mick also recently visited Japan, the major buyer of club through it purchases of western white wheat. He says by the end of April Japan may have over a two month supply of stocks so they could wait for new crop supplies. The Japanese have been urged to buy smaller amounts of wheat at a time thereby making it easier for exporters to gather the needed club volumes needed. A recent tender suggests they are following that advice. But again Mick is warning the window of opportunity for old crop club wheat marketing could quickly close. I'm Bob Hoff and that's the Northwest Farm and Ranch Report on the Northwest Ag Information Network.