Kansas Wheat Output Seen Declining 18% as Crop Tour Ends

May 2 (Bloomberg) -- Wheat output in Kansas, the biggest U.S. grower of winter varieties, will fall 18 percent in 2013 after drought last year followed by an April freeze eroded grain prospects, surveys from a three-day annual crop tour showed.

Production will drop to 313.1 million bushels from 382.2 million last year, and the average yield will decline to 41.1 bushels an acre from 42 bushels, according to the results of the tour that ended today. Analysts, farmers and grain traders covered 570 fields and also visited northwest Oklahoma.

Amid the worst Midwest drought since the 1930s, benchmark wheat futures on the Chicago Board of Trade last year rose 19 percent, the most among 24 raw materials in the Standard & Poor’s GSCI Spot Index. In 2013, prices on the CBOT and in Kansas City have dropped on speculation that global supplies will increase. The grain rallied today as the annual tour had snow for the first time in at least 21 years.

“The drought hurt the wheat a lot more than the freeze did,” Ben Handcock, the executive vice president of the Pierre, South Dakota-based Wheat Quality Council, said today in an interview on the tour. “The freeze didn’t help. It killed some of the wheat that was up and headed. I suspect that a 41-bushel average is too high.”

Oklahoma Output

Oklahoma production, already expected to decline 45 percent from a year earlier, may fall further as freezing weather tonight threatens crops.

Temperatures may drop below freezing in northwest Oklahoma, southwest Kansas and eastern Colorado tonight, Commodity Weather Group LLC Bethesda, Maryland, said today in a report. The Oklahoma Wheat Commission said yesterday that production will total 85.5 million bushels, down from 154.8 million a year earlier.

A system developing across the central U.S. may bring 6 inches (15 centimeters) to 8 inches of snow across parts of the central Great Plains and the upper Midwest today, and some areas may get more than 12 inches, according to a report on the National Weather Service’s website. The snow will continue overnight and taper off tomorrow afternoon, according to the forecast.

On the Kansas City Board of Trade, wheat futures for July delivery rose 1.1 percent to $790.75 today. The price has dropped 4.8 percent this year.

On the CBOT, wheat futures climbed 1 percent to $7.285 a bushel. The grain has declined 6.4 percent this year.

To contact the reporter on this story: Tony C. Dreibus in London at tdreibus@bloomberg.net

To contact the editor responsible for this story: Steve Stroth at sstroth@bloomberg.net

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