KANSAS CITY — With harvest in the hard winter states advancing rapidly and solid progress recorded in soft red states, the 2020-21 crop year outlook for bakers has brightened. Higher protein levels garnered in northern portions of the Southwest sent premiums on high-protein hard winter tumbling and offered the welcome prospect that less spring wheat would be needed in many flour blends for the new crop year. Good soft red winter quality in most areas represents a marked departure from the challenging situation that had become too common in recent years because of widespread fusarium head blight.
The positives continue farther north. After a dicey start to the 2020 spring wheat growing season due to severe dryness, conditions have improved over the past fortnight with the crop benefiting from a series of rain storms across the Upper Midwest. As the spring crop begins to mature (63% headed early last week), conditions were mostly favorable with 70% of the crop rated good or excellent and only 6% poor or very poor. Subsoil moisture in North Dakota was 80% adequate or surplus.
The cloud in this otherwise favorable picture was a surge in wheat futures last week, with contracts up more than 20¢ a bu through Thursday, July 9. Futures were boosted initially by strong corn prices, reflecting smaller-than-expected plantings, and then by concerns about deteriorating wheat conditions in Europe and Russia. Bakers generally held extensive forward flour coverage, allowing them to sidestep for now a weather market that could offer struggling US wheat growers much needed financial relief.