Rain floods U.S. wheat and hits futures

Source: Ukragroconsult (Ukraine)

Although the late April rains were not as extensive as some winter wheat growers had anticipated, the recent precipitation boosted yields in central Kansas and offered crucial relief to the drought-affected areas in western Kansas. This much-needed rainfall improved crop prospects by April 27 across Kansas and the main production areas, yet it also contributed to pushing wheat futures down to contract lows.

For the week ending April 27, the USDA assessed the winter wheat crop conditions in Kansas as follows: 7% excellent, 40% good, 36% fair, 13% poor, and 4% very poor – indicating an improvement from the previous week’s 41% rated good to excellent.

Other leading wheat-producing states also saw better wheat conditions around the same date. In Oklahoma, good to excellent ratings rose to 44% from 39%, Texas increased to 31% from 27%, Nebraska improved to 33% from 30%, South Dakota reached 17% from 14%, and Montana went up to 70% from 65%. Notably, in drought-stricken South Dakota – the state with the most severe drought – hard red winter wheat did not achieve any “excellent” ratings.

During the fourth week of April, rains fell across the entire U.S. winter wheat belt, with amounts varying between half an inch and 8 inches, stretching from the Canadian border down to central Texas. Some regions, however, experienced nearly sixteen times more precipitation than others. The greatest rainfall was recorded in western Oklahoma and the eastern Texas Panhandle, where some locations received as much as 12 inches. South Dakota’s dry areas saw totals between 2 to 4 inches, while the west-central region of the state received up to 8 inches. Kansas experienced at least 1 inch of rain across most wheat-growing areas, with greater amounts in many locations. Northwest Kansas saw between 4 and 8 inches, whereas the southeast and western edges of the state had between ¼ and 1 inch of rainfall.

Justin Gilpin, executive director of Kansas Wheat, noted that northwest and southwest Kansas received less rainfall compared to the west-central and central regions of the state. He explained that in areas where rain fell, it proved beneficial, whereas in regions with limited precipitation, the rainfall arrived during a period of crop stress, temporarily alleviating it. The future outcome will largely depend on whether moderate temperatures persist, avoiding any 100-degree days with strong winds, combined with timely additional rains. For wheat, the critical factor is not the quantity of rain but when it occurs; if adequate rainfall arrives in the next few weeks as the crop matures, it is expected to be highly advantageous.

May’s temperature and weather conditions will influence both the overall yield and the timing of the harvest. During Kansas Wheat Board meetings this week, most farmers reported their crops are approximately 10 days ahead of the usual schedule. USDA data indicates that by April 27, 78% of winter wheat in Kansas had been harvested, compared to 82% the previous year, but surpassing the five-year average of 66%. At that same time, 19% of another wheat crop was harvested, versus 29% and 10% for previous measures. In Colorado, 44% of wheat had been harvested by the same date, above the average of 36%.

Gilpin remarked that producers generally feel their harvest is progressing slightly faster than normal. If temperatures warm rapidly in late May, the harvest could be even earlier; however, if May temperatures remain close to 70°F, such an acceleration is unlikely.

Although recent heavy rains have boosted soil moisture and enhanced winter wheat conditions in Oklahoma and Texas, for some drought-affected crops, the precipitation may have been too late. At that stage, wheat plants may have already passed the critical developmental period during which the potential number of grains is determined.

Gilpin noted that in southwestern Oklahoma and parts of Texas, where crops have experienced significant stress, even substantial rainfall won’t benefit plants that are already too far deteriorated. He pointed out that in those regions, the wheat had largely matured before the rains arrived, meaning the highest potential for yield and production had already been lost.

Currently, the crop faces minimal threats from pests and diseases, aside from some reports of leaf rust emerging in the southern Plains. Gilpin explained that Oklahoma State University has indicated leaf rust is beginning to appear, but it might be too late for fungicide treatments. Typically, fungicides should be applied about six weeks prior to harvest, or approximately three to four weeks before harvesting. In southern Kansas, some farmers are applying annual spring fungicides to combat rust infections potentially spreading from Texas or Oklahoma, as well as to protect against parsley diseases and mitigate risks associated with rainfall during the flowering phase of the crop.

Following a wet weekend from April 25 to 27 across the Plains, Midwest, and central states, wheat futures declined sharply. In some areas, such as the lower Ohio River Valley, heavy moisture may have caused flooding severe enough to damage soft winter wheat fields. Futures prices reached new contract lows on April 28 and 29.

Basis premiums came under pressure due to abundant supplies and sluggish export demand, though late April saw some increase in spot wheat sales destined for Mexico and the Texas Gulf Coast. Railroad operations remained strong compared to previous years, enabling timely deliveries to mills, which kept wheat inventory pipelines full and contributed to a drop in the Kansas City spot price.

Gilpin remarked that farmers he has spoken with are focused less on crop conditions and more on the declining contract and benchmark cash wheat prices. There is widespread concern in rural communities regarding price trends now and prospects at harvest. He emphasized that the basis remains weak and continues to deteriorate, while price spreads and carryovers are expanding. Gilpin expressed hope that the U.S. might experience a rebound in export demand, which the wheat industry desperately needs.