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Wheat Tour Finds Lower Yield Potential; Snow and Freeze Losses Still Uncertain

By Stephanie Bryant-Erdmann, USW Market Analyst

This week I joined the annual Wheat Quality Council (WQC) “Hard Red Wheat Tour” for an early survey of the new crop. Each year, participants gather in Manhattan, KS, and spend the next two and a half days in small team, randomly stopping at 14, 15 or more fields in a full day along the same routes followed for many years. The scout teams measure yield potential, determine an average for the route and estimate a cumulative average for the day when all the scouts come together in the evening.

Just a few hours before USW published this issue of “Wheat Letter,” the tour estimated a final average yield potential of 46.1 bushels per acre (bu/ac) or about 3.10 metric tons per hectare for the 2017/18 Kansas hard red winter (HRW) crop. This year the tour participants made 469 stops to scout fields. Combining seeded area with per-acre yield potential, the total production potential estimate was 282.0 million bushels (7.67 million MT). Last year’s total production estimate was 382.4 million bushels (10.4 MMT). Sampling this year was skewed toward central and eastern Kansas due to difficulties sampling in the west.

On the first day, the tour traveled from Manhattan along several routes covering most northern Kansas counties. The cumulative Day 1 average yield potential was 43.0 bu/ac, which is equivalent to about 2.89 MT per hectare, compared to 47.1 bu/ac (3.16 MT per hectare) in 2016. To reach that average, participants surveyed 222 fields recording a range from a low of 18 bu/ac to a high of 96 bu/ac. We saw moderate pressure from stripe rust, a fungal disease, as well as viral diseases wheat streak mosaic and barley yellow dwarf. Many farmers were having fungicide applied by air to protect against fungal diseases, but there is no input to check viral disease.

Participants also received a report on the Nebraska and Colorado wheat crops. Nebraska estimated an average 40.0 bu/ac (2.69 MT per hectare) for a total production estimate of 41.8 million bushels (1.14 MMT), down roughly 41 percent from last year’s tour estimate. Colorado estimated an average of 31.6 bu/ac (2.12 MT per hectare) with total production estimated at 69.5 million bushels.

On the second day, the tour traveled on routes that led from the city of Colby to Wichita, making 202 stops. The number of observations was down significantly this year due to the challenging field conditions found in the western third of the state where wet, heavy snow continued to blanket wheat fields. After digging the wheat out of the snow, scouts noted the combination of heavy snow and accompanying 50 to 60 mile per hour winds had laid substantial portions of the wheat down and in some instances had broken the wheat stems. Wheat that was knocked over by the heavy snow, then endured several days of cold temperatures.

Standing water in fields and flooded ditches made field evaluation difficult in the south central part of the state where lodging and some freeze damage was also noted. Wheat streak mosaic was prevalent on Day 2, and participants reported seeing barley yellow dwarf, leaf rust and stripe rust. This year the tour estimated Day 2 average yield at 46.9 bu/ac (3.15 MT per hectare), for a combined two-day average of 44.9 bu/ac (3.02 MT per hectare) across 427 stops. Last year, the Day 2 average was 49.3 bu/ac (3.31 MT per hectare) and the combined two-day average was 48.2 bu/ac (3.24 MT per hectare).

A word of caution to our overseas customers is prudent. The wind, snow and cold events this year are unprecedented. Participants in the tour did the best they could to evaluate the western Kansas crop, but Dr. Romulo Lollato, Assistant Professor, Wheat and Forages Production, Kansas State University told us the most accurate assessment of the storm and freeze will not be possible for 10 to 14 days after each event. “High Plains Journal” magazine is reporting from the Tour and provides more details on Day 2 activities here. Kansas Wheat published additional information here.

Participants also received a crop report from Oklahoma, where drought conditions severely impacted the southern half of the state which received one inch (2.5 cm) of rain between September and mid-February. The northern half of the state benefited from the recent rainfall. The estimated average yield in Oklahoma is 33.7 bu/ac (2.26 MT per hectare), for a total production estimate of 100 million bushels or about 2.72 MMT. If realized, that would be down 27 percent year over year. The crop development is well ahead of normal with farmers expecting to start harvest in the next three weeks.

The third and final day of the tour was shorter, with each car making 3 to 4 field stops on the way from Wichita back to Manhattan for the final report. The Day 3 estimated average yield was 58.3 bu/ac, (3.92 MT per hectare) across 49 stops.

View highlights and photos from the tour by searching #wheattour17 on Facebook and Twitter. The WQC also sponsors a spring wheat tour in the Northern Plains in July. For more information, visit the Council’s web site at https://www.wheatqualitycouncil.org.

 

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First Reports on HRW Damage from Late Season Snow and Freeze Events: “Just Terrible.”

By Steve Mercer, USW Vice President of Communications

Kansas Wheat CEO Justin Gilpin is not a fellow who is prone to hyperbole. So, when @jp_gilp “Tweets” to the world that “we lost the Western Kansas wheat crop,” people notice.

Blizzard conditions and up to 18 inches (45.8 cm) of heavy, wet snow came down hard on the rapidly maturing hard red winter (HRW) wheat crop in northwest Oklahoma, western Kansas, eastern Colorado and southwest Nebraska April 29 and 30. Much of that wheat looked very good before the storm. Its higher yield potential was a cautious hope for some farm profit this year, a hope now broken like the stems under the snow in so many fields.

This unusual event may have overshadowed separate freeze events April 22, 23 and 27 that affected a big portion of central Kansas as well as south central Nebraska and north central Oklahoma. Kansas Wheat said “the freezes may cause significant damage in many areas because the crop was in boot and early heading stages at the time.”

Local agronomists say it will take 10 to 14 days before the final effects of the unprecedented late-season freeze and snow events can be determined with any accuracy. The first estimate from the snow alone put loss potential at 50 million bushels or almost 1.4 million metric tons (MMT). That would be roughly equal to 5 percent of the 23.8 MMT 5-year average total U.S. HRW crop.

National Association of Wheat Growers (NAWG) President David Schemm, who farms near Sharon Springs in far western Kansas, captured what is probably on the minds of most Kansas farmers. In a Facebook Live video from one of his fields as he surveyed the damage, he said, “all we can say, thankfully, in these situations is that with crop insurance we can maybe keep our farm for another year.”

More tough blows to already strapped farmers are, as Justin Gilpin added in his striking Tweet, “Just terrible.” Perhaps some of the wheat — and all Central and Southern Plains wheat farmers — will recover from these stresses.

We can only hope.

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Wheat Quality Improvement Team Travels to Asia to Discuss Quality Control

By Steve Wirsching, USW Vice President and Director, West Coast Office

The USW Wheat Quality Improvement Team (WQIT) connects wheat breeders who develop new varieties with overseas customers to discuss which quality characteristics end users value the most. This is essential to the breeding process because for farmers about half of their wheat is exported and importers expect high value from those purchases.

The latest WQIT travelled to Bangkok, Thailand, and Taipei, Taiwan, where they met with quality control specialists April 3 to 12, 2017. The team included:

  • Mike Pumphrey, Washington State University;
  • Phil Bruckner, Montana State University;
  • Robert Talley, AgriPro/Syngenta;
  • Steven Wirsching, USW.

To learn more about the team members, click here.

In Bangkok, the breeders met with milling managers from Vietnam, Indonesia, Thailand and the Philippines who gathered at the UFM Baking and Cooking School to test selected U.S. wheat varieties against their own flours made from competitor wheats under the supervision of Roy Chung, USW Bakery Consultant. An annual event, this year the WQIT observed test results demonstrating that U.S. hard red spring (HRS) wheat quality is improving with longer farinograph stability times and better water absorption. This group also provided feedback on hard red winter (HRW) wheat used for Asian style noodles that require color stability. Many new HRW varieties under development in Montana have very low polyphenol oxidase (PPO) enzymatic levels that help noodles remain bright during processing. U.S. soft white (SW) wheat stands out as the best option for sponge cakes, cookies and crackers. Solvent retention capacity (SRC) values are used to distinguish U.S. wheat quality from other competitors that have similar protein values but vastly different starch and baking qualities.

In Taipei, the team met with the Taiwan Flour Millers Association (TFMA) to discuss wheat quality and supply reliability. Overall, the Taiwanese are satisfied with U.S. wheat quality, but there is always room for improvement, and the U.S. wheat industry is working to stay ahead of the competition. The WQIT also attended the Taipei International Bakery Show and met with several flour millers. Over the years, USW, in partnership with TFMA, has worked to develop this market, and the fruits of our joint efforts were in full display at this international event. The market is incredibly sophisticated with thousands of products that continue to drive wheat flour consumption higher, such that Taiwanese now consume more wheat than rice on a per capita basis. The team also met with China Grain Products Research and Development Institute (CGPRDI) staff who have trained thousands of bakers and other end users to create a wide range of products that keep consumers interested in wheat foods. Established in the 1960s with funding from USW and state wheat commissions, CGPRDI provides technical training for bakers and millers as well as wheat quality analysis.

The wheat breeders also discussed the benefits of hybrid wheat and other non-GMO plant breeding innovations. Talley, the Syngenta wheat breeder, is developing commercial hybrid wheat varieties that promise to increase drought tolerance, heat resistance and overall yield, which could bring benefits to the wheat industry within 5 to 7 years. Some of the millers asked if the new hybrid wheat would be considered a GMO. Talley explained that hybridization has been used for many crops, most notability corn, since the 1930s. Hybrid wheat will not be a GMO crop, but will benefit from the hybrid vigor of crossing two dissimilar high quality parent lines. Like all U.S. public and private breeding programs, Syngenta is committed to bringing high quality wheat to the market.

In today’s hyper-competitive market, overseas customers are not just looking for the lowest prices. More and more are seeking real value. USW is working with public and private breeders to develop high quality wheat varieties that perform not only in the flour mill, but also in the bakery or cookie/cracker line, delivering economic value to the end users and, in turn, to millers and farmers alike.

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Wheat Quality Improvement Team to Hear Customer Preferences in Asia

By Steve Wirsching, USW Vice President and Director, West Coast Office

This week and next, USW is conducting a top-level Wheat Quality Improvement Team (WQIT) of U.S. wheat breeders taking face-to-face meetings with Asian milling and baking quality control managers to discuss end-use quality and functionality.

The breeders will hear first-hand what quality characteristics customers in overseas markets need so they can apply that knowledge in their work on new wheat varieties.

This team includes both public and private wheat breeders from the PNW focused on bringing the very best genetic technology to U.S. wheat farmers. Team members include:

  • Mike Pumphrey, Associate Professor and the Orville Vogel Endowed Chair of spring wheat breeding and genetics at Washington State University, Pullman, where he has worked since 2010. He was previously a research geneticist employed by the USDA’s Agricultural Research Service at Kansas State University, Manhattan. Dr. Pumphrey’s participation is sponsored by the Washington Grain Commission (WGC).
  • Phil L. Bruckner, a winter wheat breeder and Professor in the Plant Sciences & Plant Pathology Department at Montana State University, Bozeman. Dr. Bruckner obtained bachelors and master’s degrees at Montana State and a Ph.D. in 1985 from North Dakota State University, Fargo.
  • Robert Talley, Plant Scientist and Head of the Hybrid Wheat Development team at AgriPro/Syngenta. Talley earned a bachelor’s degree from Colorado State University, Ft. Collins, in Soil and Crop Sciences. Prior to his current position, he was with Busch Agricultural Resources where he worked on the International Barley Research and Germplasm Exchange. Talley’s participation is also sponsored by the WGC.

The team will have the chance to interact with customers that are participating in a USW wheat quality analysis program at the United Flour Mill (UFM) Baking and Cooking Center in Bangkok, Thailand, as another team of wheat breeders did two years ago. Each breeder will make a presentation on how they are contributing to continuous quality and yield improvement of U.S. SW and HRS wheat, and, in Talley’s case, the potential for hybrid wheat varieties now in development. The breeders end their trip early next week in similar meetings with millers and wheat food processors in Taiwan.

Following their activity, the WQIT members will consider how to incorporate what they hear from customers into their breeding programs and communicate their activity to U.S. wheat farmers through the Wheat Quality Council and public as well as private breeding programs.

USW will post photos and other information from the 2017 WQIT on its Facebook page at www.facebook.com/uswheat.

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Harvest Report
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Dave Green Replaces Ben Handcock at Wheat Quality Council

Dave Green, a familiar face to many who have participated in the Wheat Quality Council (WQC) Hard Red Winter Wheat Tour and Hard Spring Wheat Tour over the years, took the reins of the organization from the incomparable Ben Handcock at the conclusion of the WQC annual meeting this week in Kansas City, MO.

Everyone who has ever met Ben Hancock, who ran WQC for 25 years, will miss working with him. His gruff, pointed manner belied his dedication and love for the work and the people associated with the organization. When Handcock’s retirement was announced last year, Ag Journal reported that “he has spent a lifetime following the highs and lows of the annual wheat crop. He grew up on a 15,000-acre wheat farm in South Dakota, and farmed and ran cows for 15 years following his college graduation. He then ran the South Dakota Wheat Commission for 10 years before moving on to head the WQC in 1992.”

His colleages at USW send hearty thanks to Ben for everything he has done for the wheat farmers we represent and the experiences almost everyone at USW has had on WQC tours. We wish him a long, happy and healthy retirement.

Dave Green has been at Ben’s side organizing the WQC wheat tours in recent years. He is retired from his most recent position at ADM Milling Co. as director of quality control and laboratory services, where his responsibilities included crop surveys, wheat blends, customer correspondence and specifications. Before joining ADM, Green was a crop scout flour miller and mill technician with International Multifoods Corp. He is a past chairman of the Kansas City section of the American Association of Cereal Chemists International (AACCI), former chairman of the board of directors for the Wheat Foods Council and a 25-year member of the American Society of Baking. He also served as WQC past chairman and on several of its technical committees. A native of Akron, Ohio, he holds a bachelor’s degree from The Ohio State University.

The new WQC executive director may be reached at PO Box 19539, Lenexa KS 66285, +1-913-634-0248, and via email at [email protected].

WQC’s 2017 Hard Red Winter Wheat Tour is scheduled for May 1 to 4, and its Hard Spring Wheat Tour is scheduled for July 4 to 27. A registration form is posted online at www.wheatqualitycouncil.org, or click here.

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Premiums Rise as Supplies of High Protein Wheat Fall

By Stephanie Bryant-Erdmann, USW Market Analyst

As the Dec. 9 World Agricultural Supply and Demand Estimate (WASDE) confirms, global wheat supplies are at a record high this year. USDA increased its estimate for 2016/17 global wheat production to 751 million metric tons (MMT), up 2 percent from 2015/16 and 6 percent above the 5-year average. USDA now forecasts Australian wheat production to reach a record 33.0 million metric tons (MMT), up 35 percent year over year, if realized.

Higher yields tend to be associated with lower protein. As discussed in the Nov. 3 Wheat Letter, quality test results from Stratégie Grains, UkrAgroConsult, Canadian Grain Commission and other international agricultural groups show lower-than-average protein in the supplies from wheat-exporting countries.

Lower average protein content is problematic for many end-users. According to work done by Shawn Campbell, USW Deputy Director, West Coast Office, nearly all of the world’s high protein wheat exports (13 percent protein on a 12 percent moisture basis or higher) originate from just six countries: Australia; Canada; Kazakhstan; Russia; Ukraine; and the United States. High protein wheat production in these countries accounts for an average one-fifth of their total production in a normal year.

High protein wheat supply and demand factors are driving the growing premium between the Minneapolis Grain Exchange (MGEX), which trades hard red spring (HRS), and the Chicago Board of Trade (CBOT) and Kansas City Board of Trade (KCBT), which trade soft red winter (SRW) and hard red winter (HRW), respectively. Last December the intermarket spread between MGEX and KCBT averaged 36 cents. Fast forward to this December, and the MGEX to KCBT spread averages $1.47.

If the same high-yield, lower-than-average protein correlation also plays out in Australia, there will be little help from that corner for buyers searching for high protein wheat, further supporting the MGEX to KCBT and MGEX to CBOT spreads.

The demand for higher protein wheat also supports HRW protein spreads, which have widened significantly this year at both Gulf and Pacific Northwest (PNW) ports. Over the past 15 years, the average premium for 12 percent protein (12 percent moisture) at the Gulf has been 12 cents per bushel. This year that premium is 46 cents per bushel. The 15-year average premium for 12 percent protein HRW at the PNW is $1.05 per bushel. Since the beginning of the 2016/17 marketing year on June 1, that average premium is $1.64 per bushel.

Despite the increasing premiums for higher protein HRW and HRS, U.S. HRW exports are 25 percent ahead of the 5-year average and U.S. HRS exports are 29 percent ahead of the 5-year average. While the average protein content of HRW exports this year is down from last year due to increased demand for all HRW, 12 percent protein shipments account for 31 percent of all HRW shipments to date, up from 27 percent last year. The brisk pace of HRW and HRS exports and anecdotal reports from traders indicate buyers are breaking from the hand-to-mouth buying pattern that has been prevalent this past year to secure supplies of higher protein wheat. Forward contracting for high protein needs now makes sense.

When evaluating competing prices of high protein wheat, buyers should be sure to convert protein values quoted to a common moisture basis. Because water can be readily removed (by drying) or added (by tempering), exporters quote protein using a fixed moisture basis, but they do not all use the same basis. The United States specifies protein on a 12 percent moisture basis. The European Union and the Black Sea region typically use a dry-matter (0 percent) moisture basis. Australia uses an 11 percent moisture basis and Canada uses a 13.5 percent moisture basis. Below is an example of how moisture basis impacts actual protein received, and the conversion equation.

Please call your local USW representative if you have any questions about the U.S. wheat marketing system, U.S. wheat supply or moisture basis calculations.

Country Moisture basis used Example: 13% Protein Protein Converted to

Dry-Matter Basis
Australia 11.0 13.0 14.6
Black Sea 0.0 13.0 13.0
Canada 13.5 13.0 15.0
European Union 0.0 13.0 13.0
United States 12.0 13.0 14.8

Equation to calculate protein content based on different moisture basis:

Example: You have a sample of wheat with 10 percent protein on a 13 percent moisture basis (mb) and want to convert to 12 percent mb.

Equation:    Protein1/(100-mb1) = Protein2/(100-mb2)

10/(100-13) = Protein2/(100-12)

10/87=Protein2/88

Protein2= (88*10)/87 = 10.1%

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Wheat Breeders Traveling to Asia to Listen and Share with Milling and Baking Customers

Each year the United States exports, on average, 25 to 35 million metric tons (MMT) of wheat, which accounts for roughly 50 percent of the annual crop. This makes the voice of overseas customers important to wheat research. To demonstrate that importance, four wheat breeders will travel with U.S. Wheat Associates (USW) to Asia, April 18 to 26, 2015, on a Wheat Quality Improvement Team (WQIT).

The team will visit with buyers and end-users in Japan, Korea and Thailand to listen and exchange ideas. Their primary goal will be to gather input on wheat quality from key customers to inform their own research and to share what they learn with other U.S. wheat breeders upon their return. They will also share the successful efforts of the U.S. wheat industry to improve the quality of newly released varieties.

“It is vital that we actively listen to and respect the needs of our overseas customers,” said USW Vice President and West Coast Office Director Steve Wirsching, who will lead the team. “The impact breeders have on the industry and the livelihood of farmers is huge. Ultimately, if a variety offers higher yield potential but does not have strong milling or baking qualities that domestic and overseas customers need, farmers will feel that impact.”

This is the fourth WQIT led by USW. In 2004, a similar trip was made to Asia, followed by Latin America in 2009, and Europe and North Africa in 2010. State commissions in Oregon, Washington, North Dakota and Minnesota identified and sponsored top wheat breeders from their land grant universities to join this team.

Dr. Arron H. Carter leads the winter wheat breeding and genetics program at Washington State University where his research focuses on breeding improved wheat varieties for cropping systems in Washington state that incorporate diverse rotations and environments.

Dr. Michael Flowers is an assistant professor and extension cereals specialist at Oregon State University where his research areas include variety trials, nitrogen management in hard wheat and management practices for new Oregon winter wheat varieties.

Dr. Mohamed Mergoum represents North Dakota State University as the Richard C. Frohberg Spring Wheat Breeding/Genetics Endowed Professor. His program’s main objectives are to develop modern and improved cultivars adapted to the spring wheat region and generate wheat germplasm with valuable economic traits required in cultivar development.

Dr. James Anderson is a professor in wheat breeding and genetics at the University of Minnesota where the program he leads researches genetic investigations of complexly inherited traits, including disease resistance and grain quality, and incorporating disease and pest resistance into new cultivars using marker-assisted selection.

The WQIT is a part of a larger USW effort to address the quality of exported wheat and the needs of importing countries. It is a logical next step to a 17-year-old program called the “Overseas Variety Analysis” or OVA program. Through OVA, USW cooperates with millers and bakers to compare the performance of flour from newly or soon-to-be released U.S. wheat varieties to the local country’s standards. Results — both good and not-so-good — are shared with breeders and with state wheat commissions who develop recommended variety lists for wheat farmers. USW currently works with 22 OVA cooperators around the world. During the upcoming trip, the team will participate in an OVA workshop at the UFM Baking School in Bangkok, Thailand, to hear directly from several Asian cooperators.

USW will post photos and other information from the 2015 WQIT on its Facebook page at www.facebook.com/uswheat.

USW is the industry’s market development organization working in more than 100 countries. Its mission is to “develop, maintain, and expand international markets to enhance the profitability of U.S. wheat producers and their customers.” USW activities are made possible through producer checkoff dollars managed by 19 state wheat commissions and cost-share funding provided by USDA’s Foreign Agricultural Service. USW maintains 17 offices strategically located around the world to help wheat buyers, millers, bakers, wheat food processors and government officials understand the quality, value and reliability of all six classes of U.S. wheat.

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