Earlier this year, when farmers were dumping product, there was understandable concern for how many U.S. farms might fall under COVID-19's grasp. Despite the impacts the pandemic has had on dairy farmers, those in the agriculture segment that have been growing row crops have fared much better.
That's according to a report from the WSJ, which is reporting that futures prices for hard red winter wheat (used in baking ingredients), soybeans, and corn have risen by about a third since August. Meanwhile, soft red winter wheat, found in animal feed and processed foods, is up 22%.
According to the National Agricultural Statistics Service’s quarterly survey of millers, 234 million bushels of wheat were ground for flour between July through September, up 7% from the Q2. On the domestic home front, sourdough starters and banana-bread binges helped make up for some of the financial impacts felt by the shutdown of restaurants, hotels, and cruise ships, some of whom buy flour by the pallet.
China, who last year targeted U.S. farmers as the result of tariff disputes, is now set to import record volumes of coarse grains and buy more foreign wheat than it has in 25 years. That's according to the U.S. Agriculture Department. A near complete reversal from 2019, U.S. soybean sales to China have doubled in 2020.
Dry weather in the Great Plains of the United States as well as elsewhere in the world—Argentina, Russia, Brazil—have reduced yields. The great expectations for a bumper crop this year aren't so great now and analysts are observing weather data to get a better picture of how drought conditions might threaten prices.
