Kim Anderson, Oklahoma State University
On Feb. 9, USDA released the February WASDE report. The report was basically bullish corn and neutral soybeans and wheat.
Soybeans and wheat just can't let corn take any of the crop acres. Some analysts predict that the price battle for crop acres will go through March/April. Once producers have the corn/soybeans/spring wheat planted, the land price war will be over until the 2012 crop.
Factors supporting wheat prices are the competition for cropland, cold and dry conditions on western parts of the hard red winter area, massive snow in Canada that may delay or prohibit spring tillage and planting and countries buying wheat to insure against a food shortage. Within the next few months, most of these factors may be null events. If that happens, wheat prices could easily decline $2 per bushel.
If 2011/12 U.S. wheat production is below 2.05 billion bushels (bb) and world wheat production is below 23.5 bb, wheat prices are expected to remain near current price levels. Wheat ending stocks are sufficiently low that world production below 22 bb and U.S. production below 1.9 bb could result in wheat prices reaching spring 2008 levels. Of course, a large U.S. and world wheat crop could result in KCBT wheat prices falling below $6.