Wheat prices are improving, leaving Oklahoma farmers hopeful for this year's harvest

This year's expected harvest for hard red winter wheat could be rather average. But thanks to high prices for the grain per bushel, farmers should expect to see higher profits nonetheless.

Per-bushel prices are currently trading above $7 on the Chicago Board of Trade (and nearly $7 at elevators in Oklahoma), which is about $2 per bushel higher than last year. These prices are prompting some growers in Oklahoma who typically graze cattle on their wheat are deciding to harvest a mature crop instead.

The harvest generally starts in late May, and depending on weather conditions and the maturity of the crop, can last two to three months. 

These elevated prices are helping grain elevator operators who make their money by helping growers expand their businesses.

Those operators belong to Oklahoma Grain and Feed Association, which held its 123rd annual meeting this week in Edmond to hear and evaluate estimates made about this year's expected wheat harvest from Oklahoma State University agricultural specialists, agronomists and crop consultants.

"Just this year, we have done more new crop wheat business (deals growers make to harvest and deliver their wheat to an elevator in 5,000 bushel increments) than I have seen us do across my 30-year career combined" said Steve Sweeney, the association's chairman and general manager of COOP Services in Lawton.

Sweeney, whose operation includes several elevators outside of that area, said southwest Oklahoma's crop looks like it will be better than average this year.

"Growers are very happy about what the market has done for them the past two months, going higher and higher," Sweeney said. "We get a good crop about once every five years, and it is time. We're hopeful."

How does the 2021 wheat harvest look compared to last year?

The annual evaluation examines recent conditions involving wheat grown across nine regions of Oklahoma, with predictions made on numbers of acres harvested, average per-acre yields and a harvest total for the year.

This year's prediction estimates growers will harvest about 2.99 million acres, an average per-acre yield of 37.1 bushels and a total harvest of about 111 million bushels.

Compared with 2020, the number of acres expected to be harvested is more, but the expected yield in bushels per acre is less.

Still, if predictions hold, the total harvest will be higher than last year's 104 million bushels and higher than the 10-year median of 101 million bushels harvested in the past decade.

Zone by zone 

To get the yearly estimate, experts typically divide Oklahoma into nine regions where estimates are made on how much of the crop was planted, how much of that was intended to be harvested and current crop conditions as harvest times approach.

Like a year ago, this year’s predictions are a little bit tricky because of April freezes that hit wheat fields across the state.

In some cases, it appears the freezes didn't hurt fields too badly, while in others, it may be too soon to tell. Generally, growth in this year's crop is running behind schedule because of February's brutally cold weather.

• In southeastern Oklahoma, less rain fell this growing season than what fell a year ago, but wasn't dry enough to cause any problems with this year's crops.
• Western Panhandle wheat crops “have one foot in the grave and the other on a banana peel,” said Darrell McBee, an OSU Extension educator in Harper County. As for the eastern Panhandle, McBee said what crop there is fading because of dry weather.
• Greg Highfill, an OSU Extension agent in Alva, said wheat In northwestern-central Oklahoma is looking good, so far. "What we found overall was an excellent stand of wheat," he said.
• As for northeastern-central Oklahoma, evaluator Jeff Mitchell of Farmers Grain said he expects an average harvest for 2021, despite a slow start and bumpy weather. "It is all in Mother Nature's hands from here," Mitchell said.
• Greg Hartman, an OSU extension educator in Beckham and Washita counties, said wheat in west-central Oklahoma has been slow to germinate and mature because of dry and cold conditions. "A lot of acres are being taken out for hay" to replenish stocks cattle consumed during the February storm, he said. 
• In central Oklahoma, Grant Mason with Wheeler Brothers Grain said this year's crop looks as good as it did a year ago. "I don't think we are going to see as many fields cut for hay as we did last year, as long as prices stay where they are at," he said.
• In northeast Oklahoma, quality of this year's wheat crop looks good, provided storms stay away. Damage from a late-April freeze was light. "We need some warm, dry days to get this crop finished out," said Christopher Stauffer, a grain merchandizer at Consolidated Grain and Barge.
• Dry conditions hampered early growth of wheat in southwest Oklahoma, said Gary Strickland, OSU extension director in Jackson County. "Right now, we need rain" to finish off the crop, he said.
• And in south central Oklahoma, satisfactory yield potentials are dependent upon how much rain has fallen, said Heath Sanders, an agronomy manager at CHS Inc. "It has been a roller coaster through the year." 

Getting to market

Moving cut wheat from fields to elevators typically is done using trucks. But moving the grain from elevators where it is stored to where it is used or exported happens on the nation's rail.

Mignon Lambley, an ombudsman with BNSF Railway who works with agriculture clients, said the railroad stays busy shipping grain from Enid and southwest Oklahoma to the Texas Gulf Coast for export.

It also moves grain from Enid to the Texas Panhandle, where it is offloaded for use as livestock feed, and to California where it is milled and used in products that are sold in stores across much of the nation.

Lambley attributes improved grain prices to a tightening market for the product that has global roots in U.S. trade with China.

China, she explained, has been boosting its imports of corn, soybeans and milo while corn production in some parts of the country like the Texas Panhandle dropped because of drought issues.

Increasing corn prices have prompted many livestock feeders to turn to using grain-based feeds as an alternative to save costs.

"Wheat prices are following corn prices, to a degree."

What it means to farmers

Keeff Felty, a fourth-generation farmer and rancher near Altus who grows wheat and is the secretary of the National Association of Wheat Growers, agreed that increasing wheat prices indeed have farmers thinking about their options as crops mature.

Some may just have cattle graze it in the fields, while others will cut and store it as food to support their livestock later this year. Still others may find the financial lure of a decent payday hard to resist, he agreed.

"There is a certain amount that will have to go to hay because people will have a need for it after this harsh winter, but a larger percentage will go to harvest. It is kind of a bright spot for wheat, this year," Felty said.