Glacier FarmMedia COVID-19 & the Farm

Experts

 

The Good, Bad & Ugly

The Good, Bad & Ugly

The Good: Wheat markets headed higher today as crop production estimates for Ukraine and Russia were lowered by consultants in both countries. This marks a quick turn around from the perception that the crop in Russia and Ukraine was getting larger in mid June. The USDA will update their outlook for 2020-21 production with Russia currently expected to produce a crop that ranges from 73.5 million tonnes to 79 million tonnes. USDA is currently at 77 million tonnes and will likely move the estimate lower given the early harvest results. The first oblast to harvest is Krasnodar, which experienced the most severe drought of the western winter wheat regions.

The Bad: Sticking with the Russian theme, one of the concerns about the crop is that a heat wave is taking hold in the upper Volga valley and the Urals spring wheat growing region. The heat wave is also present in the western growing areas of Kazakhstan. These regions have received ample precipitation this growing season and crops have above average yield potential. The consistent rain has resulted in shallow root structure and the recent heat is stressing the crops. How hot are the temperatures? Most of this region reported maximum temperatures in the 38C to 42C range. This heat wave has lasted for the past 10 days with the ridge moving slowly towards the east. This is definitely bad news for the Kazakhstan and Russian spring wheat crops.

The Ugly: The COVID-19 outbreak in the southern U.S. continues to gain momentum as the number of cases climbed this week above the 60,000 case per day mark. Implications for the U.S. economy are becoming more severe as it appears that the recent momentum will likely stall as a number of states will go back into a modified lockdown.