2-4 IAT Wheat and Potatoes
Michael Stolp is Vice President – Market Research and Development for Northwest Farm Credit Services and I get together once a quarter to hear what’s happening in ag as in wheat and potatoes:
Wheat -- Northwest wheat producers face a changing marketplace entering 2014. Wheat market fundamentals are bearish, pressured by rising global stocks and weak cross market support from corn. Although U.S. wheat production was down in 2013/2014, worldwide wheat stocks rose. Stronger near-term prices are unlikely without a supply disruption. Lower corn prices are generally pressuring grain prices, and ample corn supplies are reducing the amount of wheat used as feed. Profitability for wheat producers will be challenged in 2014 given falling prices. However, strong profits in recent years bolster wheat producers’ ability to bear downside risk.
Potatoes -- Northwest fresh potato prices have improved considerably from last year. Lower potato production in the United States and Northwest is supporting the market. Fall frosts negatively impacted the storability of potatoes in some areas. Anecdotal reports suggest that producers responded by moving these potatoes to market earlier than normal. Prices dropped, pressured by the volume of early potato shipments. Where storage issues aren’t a concern, producers are delaying open market potato sales, anticipating stronger prices later in the season. Overall, potato growers are expected to earn marginal profits for their 2013 crop.
