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Spring wheat stocks to fall to 'basement levels'
 The US faces the prospect of "basement levels" of inventories of spring wheat and durum thanks to the rains which have delayed plantings to one of the slowest paces on record.Alan Tracy, the president of industry group US Wheat Associates, said that the wet weather which had left 21% of the American spring wheat crop unplanted as of Sunday, when sowings are typically all but finished, was "going to have a drastic impact on supplies". Supplies were going to become "terribly tight" for both conventional spring wheat and durum, the variety used to make pasta which is, in the main, also spring seeded. "We are looking at a reasonable carryover coming into this year, but I do not think we are going to have a carryout," he told the International Grains Council's annual conference. "We are going to be down to bargain basement levels," Mr Tracy said. The US Department of Agriculture has estimated America's hard spring wheat inventories entering 2011-12 at 215m bushels, with those of durum pegged at 47m bushels. 'Farmers giving up' The severity of the setback for the grains has been heightened by its concentration in the main growing states of North Dakota and Montana. North Dakota's durum crop is only 25% sown, compared with an average of 94%, with what has been planted backward too. Just 12% of crop had emerged as of Sunday, down from a typical 78%. In Canada, progress is not so severely behind, with 80% completed compared with 93% typically by now, the Canadian Wheat Board said. Even so that is only 2% more than last year, when wet weather forced growers to abandon millions of acres of spring crops. "Wet areas in south-western Manitoba and eastern Saskatchewan are less than 25% done, with many farmers giving up hope of planting before the June 20 crop-insurance deadline," the board said. 'Quality risk' The comments come the day after wheat prices soared above $11 a bushel in Minneapolis, where the spring variety is traded, for the first time since 2008. And the board last month highlighted that durum prices too have risen faster than those for other wheat types, "an indication that durum fundamentals are tightening". "Significant reductions in seeded area are expected in both the US and Canada," the CWB said, noting that late sowing also "increase quality risk, which is supportive" of prices of higher-grade wheat. Furthermore, drought had dimmed prospects for Europe's crop, with pre-harvest rains raising concerns for quality of Algerian and Tunisian harvests. Higher food costs = more instability in the third world This next year will bring lots of food riots and starvation. Posted by: DarthVader 2011-06-10 |
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