'11 Wheat

[protrader]

There are some rumors out there that we will see $10 wheat by May next year.  I'm sure that the rally to near $8 has quite a few people planning on planting a significant number of wheat/doublecrop acres next year but I'm just wondering how many of you siezed the price point of ~$8 5 weeks ago.  I think the next crop year looks to be even more interesting as we are lining up to have a rally on corn in march through july and see what kind of acreage battle ensues from the now competitive wheat price point.  Voice any thoughts here. 

[Palouser]

There are only two sources that have a good idea whether wheat will be $10 in May. The two sources would be God or a floor trader. So far God has never said anything about the price of wheat that I know of. Probably at least one floor trader knows, but he's wrong, as usual. But since he can trade on either side it really doesn't matter what the price is (which is probably why floor traders so easily pass on ridiculous speculation). But, if the price is going to $10 then the people who passed up 'siezing' the $8 price will look like geniuses. If it makes it to $10 I will have some wheat to sell. I always do.

There's going to be a shipload of wheat acres planted in southern areas. The money to be made may be more dependent on Brazilian beans than any other factor. Wheat prices could very well be more or less stagnate for awhile. Maybe waiting for May is the best strategy for pricing DC wheat rather than buying expensive options. But then my season up north makes the whole thing theoretical.

[ray h.]

    I guess that $10.00 would be cme HRW.Basis being different at various ports,and wheat classes,so understand that I am talking a. dollar to dollar and thirty less with our class SWW and pacific NW port. So if this remains the same in basis I have to assume $8.50 as being the may 11 price.Thats where it should be rite now,as I have tried to explain on earlyer post.Inflation figured does not equate to that high of return. I  hope it happens,the wheat price has not realy been that exciting yet!

[Canuck_2]

So I think your reference to $8 would be futures price.

Basis here in Ontario cut that back considerable for selling cash wheat.

So the question I have is how many used the runup in price to move 2010 wheat and lock in a price for 2011 wheat on the cash market?

I sold most of my 2010 wheat that was not priced before harvest as the price rose leaving me with about 20% 'just in case' the price rises more or again. I'm happy with that.

I also sold some 2011 wheat for almost $210 a tonne or somewhere around $5.70 for 60 lbs for those of you still using the old system. I could only bring myself to sell about 20% since it was still 6 weeks before I would even plant the crop but I am happy for now. Time to price more later as the wheat is now turning green.

Now IF futures prices rise to $10 for 60 lbs I will have to see but expect the actual market for the product will cut the basis to keep price close to what I have priced now. Maybe my bid for $220/t will find a taker next May.

[zman343]

Just talking around to people, there will be alot more wheat acres and alot less cattle grazing on wheat this year.  From what it sounds there were more people than thought that went ahead and locked in wheat when futures rallied over $8.  I'm not a wheat guy so I'll leave it up to you for a response, but I would think that the yield potential for wheat would be greater when cattle aren't being grazed on it.  Either way, weather permitting, we could be set for another big wheat crop in the U.S.

[Artifice]

World doesn’t work like that .

W is 7 and      “shhhhhh  it will be 10 in may, someone knows …”

It might be 4 come may.

There is no knowing.

At this point the summer spike  incites lots of WW planting the world around,

We have plenty and Russia stopped exports, all bearish.

artifice

[ray h.]

     If Canada just admitted a 17% shortfall and Russia is remaining suspended until 11 harvest,I don't see whats so bearish about that! If the whole one day spike Aug new crop at $8.00 cbot did the job,the trade is playing this game way better than the producer.

[Palouser]

There isn't a long enough season where I farm to graze anything on wheat. Even mice are a problem.

However, I've heard wheat can be forced to tiller more if it's grazed, if it isn't under stress from other factors. A matter of timing. But, I'll leave it to those who actually do it to confirm or deny this.

[GoredHusker]

Grazing wheat all depends on the situation.  The old rule of thumb used to be that Texas normally grazed out 50% of their wheat while Oklahoma grazed out 33% of their wheat.  I'd venture to guess that those percentages changed a few years ago.  However, wheat was pretty cheap this spring so some/a lot of grazing out probably occurred.  If wheat is grazed, the damage from grazing all depends on how soon the cattle are pulled from it.  If they are pulled early enough, there is little to no damage done to the wheat.  If they are allowed to graze through the jointing stage, then there will be some damage.  We used to graze a lot of wheat around here, but anymore guys just plant either rye or triticale to graze because it is hardier.  In SW NE, our normal harvest date is around the 4th of July.  I have personally grazed wheat until around May 15th before.  There was more than likely some damage to the wheat, but it still yielded fairly well.  It just wasn't mature to harvest until around August 1st.  In the end, moisture will probably have a lot more say in what happens to the wheat than anything else.  If the weather turns off dry and guys are afraid or crop losses, then they'll more than likely graze it out while they still have some salvage value.  If we get good moisture, they will pull cattle off of wheat earlier and place them on grass pastures which would benefit from the moisture as well.  If we do have a big wheat crop once again, it's quite likely U.S. carryover of wheat could surpass U.S. carryover of corn.  This would definitely set up for an interesting trade.