The Rain in May Falls Mainly on the Wheat Plains

Spend Matters welcomes this guest article by Loraine Hudson of Mintec.

Mother Nature can be unkind sometimes. Texas and Oklahoma have been in severe drought for several years and now heavy rain and flash floods have hit the southern plains. You’d think that rain to a drought stricken area would be great news right? Not necessarily if you’re a wheat farmer. That’s because sudden high levels of water increase the chance of poor yields and low quality wheat.

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There have been drought conditions in Texas and other parts of the wheat belt since 2011. The lack of rain has resulted in poor yields in the area, at a time when there are low prices as a result of record production elsewhere in the world. Wheat farmers across the plains were hopeful that the onset of the El Nino weather pattern would bring some wet weather to this parched part of the country. And boy, were they not wrong! In May, the rain started to fall much to the delight of grain farmers, but then it didn’t stop. It is estimated that 35 trillion gallons of rain fell on Texas over the month.

But too much rain can be just as bad for wheat as too little. The flood waters that have covered large parts of plains have left fields too muddy to work in. Consequently, the wheat harvest is being delayed or halted and the condition of the wheat still in the ground is deteriorating. Wet weather causes the grain to sprout and open the plants up to diseases. This lowers the protein content leaving it unfit for human consumption but suitable to be used as feed. Heavy harvest time rains in France and Germany last year resulted in a huge amount of the EU’s record production to be feed quality wheat.

After several years of good global harvests and low prices, more feed quality wheat and even lower prices would be terrible news for wheat farmers. Already we can see prices for feed wheat falling as a result of the weather compared to some rises for milling wheat even though the extent of the damage is not yet fully known.

In contrast, in the more northern states where most of the spring and durum wheat is grown, there are still dry and cool conditions. However, forecasters are suggesting the wet weather is moving northward this week and temperatures will rise. Northern wheat farmers will surely now be praying not just for rain, but the right amount this time.

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