US wheat deteriorates further, as key test looms

The condition of winter wheat, whose deterioration has fuelled a rise in prices, continued its decline in the US southern Plains thanks to a dearth of rainfall, whose severity is becoming more serious as crops break dormancy.

The proportion of wheat in Kansas, the top US wheat producing state, rated "good" or "excellent" fell by 1 point to 33% in the week to Sunday, US Department of Agriculture of scouts said.

"Soil moisture supplies continued their downward trend with less than half of the state reporting adequate supplies," the scouts said, underlining the market talk of "dust bowl" conditions in the region.

"Windy conditions were again noted with soils blowing in portions of the western half of the state."

'Significant moisture is needed'

In Oklahoma, where the proportion of wheat rated good or excellent fell 1 point to 17%, scouts also noted that "low moisture and high winds were a major concern", with winds reaching speeds of 40mph.

Besides keeping field work "to a minimum", the winds caused "erosion and dust storms" in some parts of the state.

"Significant moisture is needed across the whole state… for winter wheat development."

The conditions trimmed by one point to just 8% the proportion of Oklahoma canola rated good, with none seen as being in excellent health.

'Signs of stress'

In neighbouring Texas, the proportion of winter wheat rated good or excellent dropped by two points week on week to 11%.

"Wheat in very poor or poor condition now makes up more than half of the crop," Mark Welch at Texas A&M University noted, highlighting that a composite rating of Texas winter wheat, at 239, was well below the average of more than 300 at this time of year.

USDA scouts in Texas, flagging dust storms too in parts of the state, said that winter wheat in the southern low plains and Edwards Plateau was showing "signs of stress brought on by dry, windy conditions".

'Half an inch at best'

Nor is much rain relief expected in the southern Plains for now, with Dr Welch flagging that "the precipitation forecast for the next 5-to-7 days calls for most areas to receive an additional half an inch at best".

This following limited precipitation so far this month, when "much of the hard red production area has seen less than half inch of rain".

At Country Futures, a broker based in Kansas state, Darrell Holaday noted that the GFS weather model "over the weekend became significantly drier in the southern Plains for next week", a factor which "prompted a lot wheat buying" on Monday, when Chicago futures jumped 3%.

'Breaks dormancy'

The lack of rainfall is beginning to pose a more serious threat to yield potential as crops break from winter dormancy, entering spring growth which is a far more water-intensive stage of development.

Weather service MDA said that "dryness will remain extensive across central and south western [Plains] areas, which will stress wheat as it breaks dormancy.

"The continued dry pattern across the central and southern Plains will allow moisture shortages to persist and stress to build on wheat as spring growth accelerates."

Indeed, warmers temperatures ahead will "allow soil temperatures to rise, which will accelerate wheat early growth".

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