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Wheat on hold, farmers waiting
Despite wheat planting season's arrival two weeks ago, Crowville Elevator Company has yet to book its first bushel of wheat.
"I think it's a combination of we just don't want to book any wheat with farmers until we see it go into the ground," said Chris McManus, the purchasing agent at Crowville Elevator. "The price where it's at right now, farmers aren't asking me to book."
McManus said the biggest deterrent to planting wheat is the economic outlook for the crop.
"Where the price is right now just isn't profitable," said McManus. "Anyone planting wheat right now is betting on the price going up."
Wheat futures currently indicate $4.50 a bushel — and that means farmers who put wheat into the ground would be losing money because of high input costs.
McManus said that wheat represents too much of a gamble for farmers already hit hard by a bad year in agriculture.
"Anyone planting wheat right now is betting on the price going up," McManus said.
In previous years, farmers could have measured supply and demand outlook and other key market factors to determine if such a price increase could be expected.
However, McManus said that's not the case anymore.
"You can't look at supply and demand anymore and try to predict where the market is going because the markets have been so screwed up by outside interests — hedge funds and such," McManus said. "It's not a supply and demand market anymore."
Right now, wheat producers are keeping an ear to the ground and sitting on the ready, in case the markets begin to move.
LSU AgCenter's Carol Pinnell-Alison said the region is poised, should the markets make the turn for the better.
"We're way ahead in terms of preparation to plant," Pinnell-Alison said. "A lot of ground has been reworked and is nice and neat and ready to go."
Pinnell-Alison indicated there might be more than just fiscal considerations impacting wheat planting.
"It's just dry and people are waiting to see where prices are going to settle," Pinnell-Alison said.
In the end, however, she pointed out the economics of wheat will be the deciding factor — and that's what many producers seem to be holding for.
"It's kind of hard for producers to plant without knowing what kind of prices to expect," Pinnell-Alison said. |
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