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MARKET OBSERVATIONS by Jeremy Zwinger, Market Analyst,
US Wheat AssociatesCrop Conditions The wheat crop is expected to be much greater than had been previously predicted. All wheat planted area is estimated at 62.9 million acres, up slightly from 1999.
Total harvested area is expected to be 54.4 million acres, up 1 percent from last year. Winter wheat harvested area is now expected to total 35.4 million acres, up 2 percent from the June 1 forecast, but down less than
1 percent from the 1999 acreage for grain. This is the smallest area for grain since 1972. Planted area is slightly above the previous estimate, but still down fractionally from 1999. Spring wheat acreage
planted for 2000 harvest is estimated at 15.5 million acres, 1 percent above the 1999 total. Grain area is expected to total 15.1 million acres, up 2 percent from last year. The large acreage decline in
Montana was more than offset by an unexpectedly large increase of 1.1 million acres in North Dakota. The Montana decrease is due primarily to dry spring conditions, while North Dakota is returning to a more
"normal" acreage level. With spring wheat acres up in the Dakotas, durum acres could be expected to be reduced. However, durum planted area for 2000 harvest is estimated at 4.05 million acres, up slightly from
last year. The total area harvested for durum is expected to total 3.99 million acres, 12 percent above last year's level. In the coming weeks, rain and disease will be critical factors affecting the crop's overall
condition. In particular, some lower test weight SRW hasb been reported in Illinois. Additionally, North Dakota has experienced a historically wet June which could stimulate development of disease problems.
Market Highlights The new U.S. crop production figures point toward a much larger grain crop than had been expected. The changes came as a big surprise to the market and caused a sharp decline in futures values.
The new predictions are even more important with the production cycle approaching a close and with harvest being ahead of schedule. Additionally, the quality of the crop has the potential to be further affected by rain
during harvest (as has happened in Illinois) and disease problems. Although the world wheat stocks will continue to be very low, the U.S. will continue to carry an ever-increasing share of world stocks (20.9%), which
will continue to increase the need to export U.S. wheat. Careful attention will need to be given to several areas in the coming weeks. China continues to have a less than ideal production outlook with predictions from
the trade ranging from 95 to 104 MMT. The final outlook of the Chinese crop could have huge effect on total supply and price in the world markets. Russia's crop is predicted to have problems with a 6 to 8 MMT deficit.
There is a possibility of a U.S. government program for Russia with credit being the likeliest option. The final size of the large EU crop continues to be of concern as some in the grain trade are beginning to
reduce the record 106 MMT prediction. The size of the crop will affect the level of US imports, especially in the vital North Africa region. North Africa continues to be a concern as drought-induced production problems
are widespread. Specifically, Egypt's import pace is expected to accelerate to cover wheat needs as the world situation tightens. In a significant market movement, Egypt bought over 300 TMT of U.S. wheat in this last
week alone. U.S. Wheat Associates is the industry's export market development organization, representing wheat producers in 19 states. FRENCH WHEAT HARVEST BEGINS EARLY WITH EXPECTATIONS OF A BETTER CROP According to newswire sources the soft wheat harvest has started one week early in southwest France with nearly 20% of the wheat area already harvested. A spokesman for
the French grain's technical institute indicated this year's harvest could be over as early as July 14. Furthermore, the spokesman suggested, that in general, this year's French wheat crop would be better in
quality and yield than last year. "Yield is up 0.5-1.0 MT/HA (7.44-14.87 BU/AC) on last year and protein content should average around 11-11.5% (dry basis)," the spokesman said. Sources add that disease
was better controlled this year due to increased applications of fungicides. However, one newswire source estimates that nearly 60-70% of the wheat crop is currently "leaning" on the ground. USDA ISSUED QUARTERLY ACREAGE & STOCKS REPORT On the Friday, June 30, 2000, the USDA issued their quarterly acreage and stocks report for US wheat. USDA
estimated 2000-01 all US wheat planted area at 62.95 MA (25.47 MH), up slightly from their 1999-00 forecast of 62.81 MA (25.42 MH). Moreover, the USDA projected 2000-01 all US wheat harvested area at 54.45 MA
(22.03 MH), up from their 1999-00 forecast of 53.91 MA (21.82 MH). Contrary to private commodity analysts' estimates, the increase in acreage came from US spring and durum wheat. USDA officials estimate that
US farmers planted 4.05 MA (1.64 MH) of durum wheat in 2000-01, slightly higher than last year's forecast of 4.04 MA (1.63 MH). Likewise, the USDA forecast 2000-01 US durum harvested area at 3.99 MA (1.61 MH),
compared to their 1999-00 estimate of 3.57 MA (1.44 MH). Furthermore, the USDA pegged 2000-01 US other spring wheat planted area at 15.55 MA (6.29 MH), versus their 1999-00 forecast of 15.35 MA (6.21 MH).
Similarly, the USDA projected 2000-01 US other spring wheat harvested area at 15.06 MA (6.09 MH), nearly 2% higher than last year's figure of 14.77 MA (5.98 MH). Meanwhile, the USDA lowered their 2000-01 US winter
wheat area planted to 43.35 MA (17.54 MH) compared to their 1999-00 forecast of 43.43 MA (17.58 MH). Likewise, USDA pegged 2000-01 US winter wheat harvested area at 35.40 MA (14.33 MH), slightly lower than their
1999-00 forecast of 35.57 MA (14.40 MH). Furthermore, the USDA issued their forecast for the 2000-01 all wheat stocks as of June 1, 2000, at 950 MB (25.9 MMT), compared to their 1999-00 estimate of 946 MB (25.7
MMT). SOIL SAMPLING FROM THREE AREAS CAN AID CROP PROBLEM DETECTIVE WORK
July 7, 2000 When there is a problem with crop growth in a certain area of a field, some crop detective work may be necessary to find the cause. Collecting and
analyzing soil samples can be a useful detective tool, says George Rehm, soil scientist with the University of Minnesota Extension Service."Soil sample collection for detective work involves a different process
than routine sample collection," says Rehm. "A single sample from the problem field will usually not provide an answer." If checking for nutrient deficiencies as a possible cause of the crop problem,
collect three samples, says Rehm. If nutrient deficiencies are responsible, crop growth or stunted growth will not be uniform across the field. Instead, growth will range from good to poor. "For these situations,
collect one sample from an area where the crop is growing well," says Rehm. "The second sample should come from an area where the stunting or abnormal growth is most severe. The third sample should come from
an area where the symptoms are just starting to appear. This marginal stunting or poor growth usually shows up in areas next to the portion of the field where the stunting is most severe." Rehm says an evaluation
of the combined results of the analysis of each sample can often identify the cause of a problem-if a nutrient deficiency is the cause. Soil sampling will not be helpful if the poor growth is due to plant diseases,
pests, or incorrect herbicide application. Rehm says soil sampling depth for crop growth analysis should be the same as for fertilizer recommendations. If problems with immobile nutrients are suspected, this is 0-8
inches. If a problem with a mobile nutrient such as nitrogen is suspected, collection of deep samples may be necessary. Rehm says one approach is to collect soil from depths of 0-6, 6-12, 12-24, and 24-36 inches.
Collect several cores from each of the three areas. "There is no guarantee that this sampling strategy will identify the problem," notes Rehm. "However, this process will provide much more information
than analysis of a single sample that is supposed to represent the entire field." Source: George Rehm, (612) 625-6210 Editor: Joseph Kurtz, (612) 625-3168,
jk@umn.edu CANADA AG NEWS:
SURVEY SHOWS LESS WHEAT, CANOLA Canadian wheat and canola crops are expected to be smaller this
year, according to a new survey by Benson Quinn-GMS, Inc. The cooler temps have helped crops survive drier-than-normal conditions...Finish the article at www.agdayta.com |