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U.S. Winter-Wheat Condition Worst in 27 Years as Drought Lingers

U.S. Winter-Wheat Condition Worst in 27 Years as Drought Lingers
Winter wheat stands in a field in Streator, Illinois. Photographer: Daniel Acker/Bloomberg

The condition of winter-wheat crops in the U.S. are the worst for this time of year since the government began monitoring in 1985, as drought damage spread from Midwest corn and soybean fields to the Great Plains.

An estimated 40 percent of winter wheat, the most-common domestic variety, was rated good or excellent as of Oct. 28, with 15 percent poor or very poor, the U.S. Department of Agriculture said today in its first assessment of the season. A year earlier, 46 percent got the top ratings.

The worst U.S. drought since 1956 already has cut output of the nation’s two biggest crops, corn and soybeans, and sent prices to record highs. Wheat futures are up 32 percent this year. About 79 percent of Kansas, the biggest grower of winter grain, was in extreme or exceptional drought as of Oct. 23. Warm, dry weather the next two weeks will delay plant emergence and root growth before crops begin to go dormant for the winter. The U.S. is the world’s largest exporter of wheat.

“The low crop ratings will increase concern about the yield potential of this year’s crop,” Shawn McCambridge, the senior grain analyst for Jefferies Bache LLC in Chicago, said in a telephone interview. “The weather doesn’t look promising for much improvement and may increase overseas demand for supplies left from last year’s U.S. harvest.”

Wheat planting was 88 percent complete in the top 18 producing states, compared with 81 percent a week earlier and 86 percent a year earlier, the USDA said today in a weekly report that was delayed two days because of Hurricane Sandy. About 63 percent of the plants had emerged from the ground, down from the previous five-year average of 67 percent because of dry soil.

Need Rain

“The crop needs some rain for improved development before going dormant later this year,” Brian Grete, the senior market analyst for Professional Farmers of America in Cedar Falls, Iowa, said in a telephone interview before the report. “While it’s hard to kill wheat at planting, this year’s crop will need more rain when it emerges from dormancy to reach its full yield potential.”

The corn harvest was 91 percent complete as of Oct. 28, compared with 87 percent a week earlier and the previous five-year average of 60 percent, the USDA said. An estimated 87 percent of the soybean crop was harvested, the report showed, compared with 80 percent a week earlier and the five-year average of 78 percent. The U.S. was the world’s biggest grower and exporter last year.

The government said this month that corn production will plunge 13 percent this year because of the drought. In June, the USDA predicted a record harvest. Soybean production is expected to plummet 7.5 percent, the third straight annual decline, according to the agency.

“Heavy rain, snow and high winds may have damaged some remaining crops along the path of Hurricane Sandy,” Grete said.

Corn is the biggest U.S. crop, valued at $76.5 billion in 2011, followed by soybeans at $35.8 billion, government figures show. Wheat is the fourth-largest at $14.4 billion, behind hay.

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