Pacific NW Wheat Review and Outlook
Pacific Northwest Wheat Review and Outlook
I’m KayDee Gilkey with the Northwest Farm and Ranch Report after this.
The Northwest’s largest cooperative ag lender, Northwest Farm Credit Services, produces quarterly market snapshots on 13 different commodities. Today we will be looking at how wheat fared in 2011 and what to expect this year for wheat growers.
The quarterly wheat market snapshot states that most wheat producers ended 2011 with strong profits and balance sheets flush with liquidity.
Northwest FCS Vice President of Market Research and Development Michael Stolp gave the association’s outlook for wheat in 2012.
Stolp: “As we look at the wheat crop currently, generally today it is under snow. It is entering the winter season in relatively good shape -- particularly in Washington and Idaho -- producers seeded into decent moisture conditions. Looking forward, we see some pressure on wheat prices. As we look at world, we see record world production as well as record world wheat supply. That is likely to put downward pressure on those wheat prices. However, in 2012 there is some hope for strong financial condition for wheat producers as revenue protection prices -- that is crop insurance-- are strong in the Northwest.”
Wheat market strength is a result of the substitution of wheat for feed grains, competition for U.S. crop acres between corn, soybeans, and spring wheat, and the persistence of the La Nina weather pattern. Combined, analysts believe these forces are likely to support continued wheat market strength and volatility into spring of 2012.
I’m KayDee Gilkey on the Northwest Ag Information Network.