Milling & Baking News - May 5, 2020 - 18

Data

about 20¢ to 30¢ a lb lower for the week as
of April 21, Mr. Moscoguiri said. Markets
saturated with liquid egg, and processors
were turning to drying. The price had
dropped another 15¢ a lb as of April 24.
"Business is not good for our industry,"
a Midwest egg processor said. "No matter
where you are in the chain, everything is
turning into losses. People are desperate."
Sharp reduction in layer flocks
The actual supply of eggs never was an
issue. The shortage at retail resulted from
a sudden surge in buying, and deliveries needed a couple of weeks to catch up.

Most sources maintain there was an oversupply of eggs prior to the pandemic that
briefly was relieved by near panic buying
at retail in the early stages of sheltering
at home. The oversupply mostly was the
result of a buildup in cage-free laying
flocks without an offsetting depopulating
of conventional laying flocks. But that has
begun to change, with producers reducing the number of layers by about 10 million during the first quarter.
"The market forced them to adjust,"
Mr. Moscoguiri said. "And it will force
them to make future corrections."
The Midwest egg processor agreed,

Wet fields and planting decisions in
flux slow spring wheat seeding

18 / May 5, 2020

017_MBN_May5_20.indd 18

Milling & Baking News

31%) and 88% in Washington (45%, 53%).
In a way, the coronavirus pandemic may
be slowing planting progress. Oil markets
have tanked in the six weeks since most
Americans began sheltering at home,
which has decimated demand for cornbased ethanol, pressuring corn prices, and
turning some producers' thoughts to seeding spring wheat instead of corn. A moving
target in intended acreage would contribute to the slowing the progress of planting.
"In southern South Dakota, a little bit in

Other spring wheat plantings
13.2
12.7
12.6*

13.4
11.6
11.0

13.0

11.6

13.6

in million acres

12.3
12.3

KANSAS CITY - Spring wheat seeding
in the northern Plains region was ahead of
a year earlier but well behind the average
pace, the US Department of Agriculture
said in its latest Crop Progress report. Wet
soils and cool temperatures well into April
were primarily to blame. At the same time,
there was renewed interest in seeding
hard red spring wheat over corn.
Late spring cold weather made some
producers anxious about seeding in
less-than-ideal conditions. The past few
weeks have seen below-average temperatures reaching down into the lower teens.
As late as the third week of April, temperatures dipped into the low- to mid-30s
in parts of North Dakota.
Excess moisture has contributed to
fieldwork delays as well. The 2019 harvest in places was cut short by early
winter that left fields extremely wet. The
eastern areas of spring wheat country
have continued to deal with too-wet soils.
Ponding noted in some fields was indicative of some frost layer remaining in the
ground.
Cold temperatures and wet soils hindered producers seeking to drill seeds with
confidence that the seeds won't languish
for an extended period before germination.
The USDA in its latest Crop Progress
report issued April 27 said spring wheat
in the six principal production states
was 14% planted, advancing from 7% a
week earlier. The pace was ahead of 11%
a year earlier, when planting was delayed
by rainy weather that generated intense
flooding, especially in South Dakota. The
recent five-year average spring wheat
planting progress was 29%.
Planting completion by April 26 was
5% in North Dakota (4% a year ago, 18%
as the average), 36% in South Dakota (6%,
61%), 6% in Minnesota (1%, 30%), 61% in
Idaho (55%, 61%), 11% in Montana (19%,

'10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20
Source: US Department of Agriculture

*forecast

Minnesota and certainly North Dakota, the
decline in ethanol output and the shutting
down of some plants has corn economics
driving planting decisions," said Jim Peterson, policy and marketing director with the
North Dakota Wheat Commission.
"Even though spring wheat prices
aren't that rosy, and they continue to slip,
growers are betting on the speculative
that come fall, prices will be better and
wheat prices have a little more potential
than corn," he said.
Another factor is the dramatic drop in
demand seen at malt plants in some parts
of Montana and western North Dakota.
"Some of those plants ship over to
Europe, and some of the barley trade to

saying, "There are definite flock reductions happening."
The low prices for eggs and products
have created buying opportunities.
"There is a tremendous opportunity to
purchase eggs to help alleviate the surplus
and take advantage of low prices if you
can produce for retail," Mr. Moscoguiri
said. "It's a great buying opportunity, but
extreme markets tend not to last too long."
Mr. Moscoguiri said there were signs prices were nearing a bottom. At the same time,
he said buyers most likely can't lock in current low prices as sellers can't afford to commit to those levels for a long period of time. MBN
Mexico has been hampered a little bit
with less consumption at restaurants and
tourist points," Mr. Peterson said. "We've
heard that in some cases, contracts are being pulled or backed out on, or the act-ofGod clause is being invoked by the buyer,
not the producer, so spring wheat is the
next best option in some of those areas."
The pace of corn seeding also could indicate intent to plant more spring wheat. The
USDA said corn planting in Minnesota by
April 26 was 40% completed, well ahead of
1% a year ago and double the average of the
past five years. That partly may be attributed to corn planted in southern regions of
Minnesota, where soil temperatures have
warmed sooner and where fewer acres of
2019 corn remained unharvested. But shifting intentions also could be behind the
sharp advance for the latest week.
And in North Dakota there was "still
a little bit of sting from some of the quality hits on corn last year, so there's probably some uncertainty," Mr. Peterson said.
"There might be a little bit of indecisiveness in that number, too, not knowing how
many actual acres of corn will get planted."
That comports with a run on sales of
certified spring wheat seeds and a return
of some of the corn seed noted during the
past few weeks, he said.
Overall, wheat market stakeholders
weren't overly concerned about the slow
pace of seeding. Insurance deadlines for
southern South Dakota were still about a
week out. But denser spring wheat areas
in northern South Dakota had until midMay to seed or seek insurance payments.
Plus, growers were heartened by lessons from the delayed 2019 crop that still
produced good yield despite some compromised quality.
"I think producers have learned that
even though we seed the crop late, we can
still pull off a pretty good crop," Mr. Peterson said. "If we get well into May and continue to run double digits behind normal,
then I think we'll start to be concerned that
some acres are switching to other crop." MBN
bakingbusiness.com / world-grain.com

5/1/2020 9:46:57 AM

http://www.bakingbusiness.com http://www.world-grain.com

Milling & Baking News - May 5, 2020

Table of Contents for the Digital Edition of Milling & Baking News - May 5, 2020