US farmers, millers, and bakers are already bracing for a sharply reduced spring wheat harvest due to the driest conditions in decades. But Gro expects abandoned acres of hard red spring (HRS) wheat will be much higher than current USDA estimates, which could depress the crop further.
In its September WASDE, the USDA estimated HRS production of 305 million bushels, down 42% from last year and the smallest crop since 1988. Total spring wheat yield is expected to plunge 37% year over year to 30.6 bushels per acre. Gro has been warning since late March that dry conditions in the US and Canada could reduce spring wheat production.
Gro forecasts production could drop even further due to higher abandonment rates. In past years of similar drought conditions, farmers left unharvested 8% of total spring wheat acres in 2017, 15% in 2002, and over 20% in 1988. Currently the USDA is forecasting a 3% harvest loss.The department will report harvested acres estimates in its Sept. 30 Small Grains Summary.
Acreage abandonment rates comparable to previous drought years would reduce total US spring wheat production this year by between 25 million and 60 million bushels, taking the US balance sheet to even tighter territory and adding support to prices that are at their highest levels since 2012.
HRS accounts for about 20% of US wheat production and is grown primarily in the Northern Plains (North Dakota, Montana, Minnesota, and South Dakota). HRS wheat is valued for its high protein levels, which make it suitable for specialty breads and blending with lower protein wheat.
Farmers abandon acres when crops become uneconomic to harvest, for example, because of poor yields. Roughly 3% of spring wheat acreage nationwide is abandoned each year, based on a 10-year average, a Gro analysis shows.
Spring wheat is a high value crop, bringing in more dollars per bushel than other competing crops. Farmers try to harvest anything that will at least pay the cost of harvesting, so cases of abandonment are typically very low compared with other grains. With HRS wheat ending stocks at their lowest levels since 2008, any additional lost production will be felt keenly by food companies and other end users.
This insight was powered by the Gro platform, which enables better and faster decisions about factors affecting the entire global agricultural ecosystem. Gro organizes over 40,000 datasets from sources around the world into a unified ontology, which allows users to derive valuable insights such as this one. You can explore the data available on Gro with a free account, or please get in touch if you would like to learn more about a specific crop, region, or business issue.