Wheat Tour Finds Stunted Crops on Trek in Drought-Hit Kansas

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(Bloomberg) -- America’s bread basket is looking pretty dried out.

That’s what’s being confirmed this week as traders and analysts trek across Kansas for the Wheat Quality Council’s annual crop tour. Plants are shorter than normal with shallow roots after drought this winter, coupled with an unusual spring cold, stunted development. Some fields were in such bad shape that farmers talked about ripping up their crops and replanting with sorghum.

July futures for hard red winter wheat jumped 11 percent in April on speculation that drought would damage Great Plains crops. This week’s tour was the first opportunity of the year to systematically inspect multiple fields and assess the damage from the dry, freezing weather. Kansas is the biggest U.S. grower of the grain variety that’s mostly used in bread-making.

“The market’s really been paying close attention to it,” said Brian Hoops, president of Midwest Market Solutions in Springfield, Missouri. “The tour overall may come in somewhere less than last year, but maybe not as bad as some people had feared.”

Yields measured Tuesday by participants on the tour averaged 38.2 bushels an acre in northwest and north-central Kansas, the lowest for the day since 2015. On Wednesday, results in western Kansas were 25 percent below last year. Reports from Nebraska, Colorado and Oklahoma also indicated waning production.

About 90 traders, millers, farmers and government employees are weaving along routes from Colby to Wichita. The group will issue a final yield estimate for Kansas on Thursday. While there has been some rain during the tour, more than half of the state was facing moderate to severe drought as of May 1, the latest U.S. Drought Monitor figures show.

At midday Wednesday, plants in western Kansas were less than half their normal, height increasing this risk of additional yield cuts unless there’s significant precipitation in the next two weeks, Dennis Haugen, a director of the North Dakota Grain Growers Association, said in an interview near Ness City.

“My main concern is the stage of crop development is so far behind,” he said.

©2018 Bloomberg L.P.

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