BREAKING NEWS: U.S. Manufacturing Grows at Fastest Pace in Three Years

Search

Rain-Soaked North Dakota Wheat Planting Delayed Most in 32 Years

By Tony C. Dreibus
June 05, 2013 8:00 PM EDT

Wheat-planting delays in North Dakota, the largest U.S. producer after Kansas, are the worst since at least 1981 as the wettest start of the year on record leaves fields across the state too muddy.

Farmers had sown 62 percent of the spring-wheat crop as of June 2, the slowest pace since records began 32 years ago, U.S. Department of Agriculture data show. The delay may limit planting to 4.7 million acres, the fewest since 1969 and 24 percent less than the 6.2 million forecast by the USDA, said Mike Krueger, the president of Money Farm, a grain-market adviser in Casselton, North Dakota.

While wheat prices tumbled into a bear market this year as global output headed to the highest ever, supplies are dropping in the U.S., the largest exporter. The worst drought since the 1930s damaged winter crops being harvested this month in the southern Great Plains, and too much rain delays planting of spring varieties in the north. Rainfall in Fargo, North Dakota, was the wettest on record going back to 1881, state data show.

“You never want to turn down rain in this part of the country, but when it keeps coming and coming, and you can’t do what you need to do to finish planting, it’s frustrating,” said Harlan Klein, who had sown all but 200 of the 9,000 acres he farms in Elgin, North Dakota, before rain arrived on May 15. “It started raining and hasn’t stopped.”

Fargo, located on the eastern border with Minnesota, got 13.37 inches (34 centimeters) of rain in the past 155 days, the wettest start to the year since record-keeping began 132 years ago, Adnan Akyuz, the state climatologist, said in a telephone interview from the city. Minot, a north-central city, got 12.38 inches, the third-wettest on record going back to 1905, he said. In the past 60 days, rainfall was six times normal in parts of the state, National Weather Service data show.

More Rain

As much as 2 inches of rain will fall in some areas in the next seven days, and the state will be wetter than normal for the rest of the month as a weather system is “parked” over North Dakota, Akyuz said.

“This is an unusually wet event,” Akyuz said. “Corn and wheat are supposed to be emerging from the ground and getting to a stage where they can draw moisture from the soil, and it’s not doing that. It’s muddy and wet compared to if we had vegetation in the soil. This wet and cool weather is ruling farmers’ lives.”

With 2.23 million acres unplanted so late in the season and more rain on the way, some farmers may be forced to switch to soybeans or sunflowers, or leave fields fallow and make a claim on their crop insurance, Money Farm’s Krueger said.

Spring Wheat

North Dakota farmers were forecast by the USDA on March 28 to plant 7.65 million acres with wheat this year, 81 percent of which is spring wheat sown in May that is harvested in September. Durum wheat planted around the same time was forecast at 1.1 million acres, or 14 percent, and the rest, less than 5 percent, was winter wheat sown in October and harvested in June.

Planting in the six largest spring-wheat-growing states was 80 percent complete on June 2, up 1 percentage point from the previous week, USDA data show. A year earlier, the entire crop was sown, and the average over the previous five years was 92 percent.

Spring-wheat futures traded on the Minneapolis Grain Exchange have yet to respond to the planting delays, with prices down 5.7 percent this year to $8.16 a bushel yesterday. On the Chicago Board of Trade, the global benchmark for wheat, futures are down 9.8 percent to $7.015 a bushel.

Record Output

World output of all wheat varieties will surge to a record 701.1 million metric tons, including a 48 percent jump in Russia and 40 percent from Ukraine, the USDA said May 10. Output in Canada, where spring wheat is also grown, will rise 6.6 percent to 29 million tons. Global inventories will rise 3.4 percent to 186.4 million tons, according to the U.S. government.

“There’s too much grain in the world,” Tomm Pfitzenmaier, a partner at Summit Commodity Brokerage in Des Moines, Iowa, said by telephone. “You can have some losses in the Dakotas, and it will matter to the people losing it, but it won’t matter around the world. Russia and Ukraine are going to undercut us on price every chance they get.”

Speculators held a net-short position, or bets that prices will fall, of 36,167 futures and options contracts in the week ended May 28 and have been net-short every week this year, Commodity Futures Trading Commission data show.

Kansas Drought

Prices in Minneapolis probably will rise later this year as the world gets low on high-quality hard wheat grown in the U.S., according to Klein, the North Dakota farmer.

Little or no rain has fallen in parts of western Kansas or the Oklahoma and Texas panhandles in the past 30 days, NWS data show. The U.S. winter-wheat crop, which accounts for more than 70 percent of total domestic output of the grain, was rated 32 percent good or excellent as of June 2, down from 52 percent last year and the worst for that date since 2006. The crop entered dormancy in November in the worst shape since record-keeping started in 1985 because of the drought, USDA data show.

In North Dakota, late snow and excessive rain has left most wheat fields in northern counties unplanted. David Clough, 67, said he has 20 percent of his 1,600 acres seeded on his farm near Fessenden, where rains have been among the heaviest he remembers seeing in 50 years. The area got 10 inches of rain in the past two weeks, compared with annual totals of about 17 inches, he said.

“We’ve been wet before and we’ve had floods, but usually we have a week of good weather where we could get some planting done,” Clough said. “This year, we get into the field for a half a day and it rains again. We can’t get anything planted. It’s really not good.”

To contact the reporter on this story: Tony C. Dreibus in Chicago at tdreibus@bloomberg.net

To contact the editor responsible for this story: Steve Stroth at sstroth@bloomberg.net

Comments
More related content »