Organic wheat
Hard red winter wheat prices were mostly steady in January.

KANSAS CITY — Average prices for organic food-grade hard red winter wheat and corn during the December-January period advanced from November-December, while soybean prices declined, according to Mercaris, the organic and non-G.M.O. market information company and trading platform.

Hard red winter wheat prices were mostly steady in January, but the price range tightened from December, with most quotes in the $10- to $12-a-bu range, said Ryan Koory, Mercaris senior economist. Organic food-grade hard red winter wheat prices averaged $11.80 a bu in December 2017-January 2018, up 17c from November-December and up $1.85 from October-November but down $2.06 from $13.86 a bu a year ago, he said.

Ryan Koory, Mercaris
Ryan Koory, Mercaris senior economist

“The end of 2017 brought a swift jump to price quotes, which the market has thus far held onto for 2018,” Mr. Koory said. “However, market fundamentals are not 100% behind sustained bullish momentum. Organic wheat production in 2017-18 is estimated to have been up 14% year over year following growth in harvested acres, despite lower yields. Winter wheat yields appear to have been less impacted than spring wheat and durum wheat. Also, feed-grain wheat is showing bullish momentum following higher corn prices, but it is not clear how much of this pressure will find its way into the winter wheat market.”

Market activity for food-grade organic durum and hard red spring wheat was insufficient to quote during the December-January period, Mercaris said. A year ago, organic durum was $16.47 a bu while hard red spring wheat was unquoted.

“However, the overall price trend (for hard red spring wheat) remained mostly unchanged from the previous month, with most volumes trading in the $16- to $18-a bu-range,” Mr. Koory said.

Organic corn
Food-grade organic corn prices continued to firm.

Food-grade organic corn prices continued to firm. Corn averaged $9.87 a bu in December-January, up 68c from November-December, up 10c from October-November and up 49c from $9.38 a bu a year ago.

“Although January trade volumes remained low — their lowest level since July 2017 — the price range around the transactions reported moved higher,” Mr. Koory said. “January 2018 saw organic food-grade corn trade mostly in the $9- to $10-a-bu range. January may market the low point for organic food-grade corn activity. Mercaris expects volumes will begin to pick up by the end of quarter one as purchasers start to make plans based on 2018-19 crop expectations.

“We also look for more bullish pressure to work its way into organic food-grade corn markets as the 2017-18 crop is mostly spoken for at this point, and spot purchases will be harder to find, or need to travel farther to reach processors. Additionally, food-grade organic corn may receive some support from the animal feed sector as declining organic corn imports look to add bullish supply pressure to the outlook for feed-grade organic corn.”

Organic food-grade soybean prices, meanwhile, eased in the latest two-month period but remained well above the year-ago level. Soybean prices averaged $23.46 a bu in the latest period, down 20c from November-December but up $1.12 from October-November and up $3.04 from $21.42 a bu a year earlier.

Organic soybeans
Organic food-grade soybean prices eased in the latest two-month period but remained well above the year-ago level.

“Like corn, food-grade soybean trade activity remained slow in January, while the range around prices quoted tightened back to the $18.50- to $24-a-bu range,” Mr. Koory said. “Overall organic food-grade soybeans trade is expected to progress a lot like corn. Purchasing activity is expected to pick back up soon. Also, this winter is likely setting a low point for the market demand as both the food and feed sectors are expected to see another year of robust growth over 2018.

“Unlike corn, soybean imports have not yet shown any sign of significant slowdown. However, demand for soybeans appears more bullish this year compared to corn and is expected to provide enough support to pull prices higher year over year through the remainder of 2017-18.”

Overall, Mr. Koory said farmers holding on to their remaining organic crops, hoping for a price bump ahead of spring planting, were contributing to the light spot activity. Typically, contracting for next year (2018-19) begins late in the first quarter, he said. The trend remained more bullish than bearish, in part due to slower imports of organic grains.

As demand for organic grains continues to outstrip supply, whole grain cereal and snack manufacturer Kashi Co. said recently it has paid farmers more than $1 million under its Certified Transitional program, which it began in 2016 to help support farmers during the three-year transition period required to receive U.S. Department of Agriculture organic certification. During the transition period, farmers must use organic practices, which may reduce yields and add other costs, but can’t market the crops at typically much higher organic prices, which can create financial hardship until the crops are certified organic. Last year Kashi said it had about 3,500 acres in its Certified Transitional program, more than quadrupling in just a year.

Kashi Cinnamon French Toast cereal
Kashi's latest Certified Transitional product is new Cinnamon French Toast cereal.

Kashi, in partnership with Quality Assurance International, sells a line of Certified Transitional products that source grain at higher prices from farmers in transition from conventional to organic farming practices that have not yet received U.S.D.A. organic certification.

The U.S.D.A. approved a certified transitional program developed by the Organic Trade Association last year. But implementation has been stalled by a legal challenge from another industry group, and the program remains under review.

Less than 1% of U.S. farmland is certified organic, according to the U.S.D.A. In 2016, the most recent data available, the U.S.D.A. said 5,019,496 acres were certified organic, including 2,714,498 acres of cropland and 2,304,998 acres of pasture. Field crop harvested area was 1,684,047 acres, including 213,934 acres of corn, 124,591 acres of soybeans and 336,550 acres of wheat. The wheat acres included 222,890 acres of winter wheat, 12,176 acres of durum and 101,484 acres of spring wheat other than durum.

Mercaris is a comprehensive source of market data and online trading for feed-grade and food-grade organic and non-G.M.O. commodities based in Silver Spring, Md. For more information visit