As harvest rolls on where weather allows, traders are getting a better handle on the yield and quality profile of this year’s wheat crop.
“Proteins have been higher than last year by about 6/10ths to 8/10ths of a percent, depending on the area,” says Burnett. “In the drought region we’re seeing significantly higher proteins than last year.”
Yields are “maybe coming in a little bit better than expected,” but they’re still well below production during the last couple of seasons due to the drought this summer.
Globally, the USDA on Friday pegged wheat production at 731.6 million tonnes — a third consecutive record — with big crops in Europe and the Black Sea region pressuring the market downward.
After trending lower since early summer (like the Blue Bombers and Riders), Burnett suggests the wheat market is probably close to bottoming out.
“There’s a base level that wheat can go down to versus corn, as the corn situation maybe isn’t quite as negative as what the wheat one is on a global basis,” he says, noting “once that happens, we could rally off of that. The market becomes very short in these kinds of circumstances.”
Bruce Burnett describes the supply/demand situation as this year’s wheat crop hits the market: