2024 Wheat Dilemma
Sep 10, 2024
2024 Wheat Dilemma
The 2024 Spring Wheat harvest/crop has been challenging. Markets are near their lowest levels in 5 years. Interest rates are up substantially from a few years ago, and input costs are up. Now we are in the middle of a quality issue that is negatively impacting the value of our wheat crop.
We are all dealing with a large wheat crop with:
1) The lowest protein we’ve seen in the last several years
2) Weather conditions this summer that created fusarium head blight (scab damage) which is the source of vomitoxin (VOM).
3) The 2-4” rain a couple of weeks ago that—for any wheat that was ripe, reduced the test weight and produced sprout damage and a falling numbers issue.
4) Valley United’s inability to store wheat due to the potentially large soybean and corn crop.
Let’s look at each problem:
Protein: So, at the moment, mills are not yet prepared to handle lower protein wheat. We are seeing this at a local level being very evident. The North Dakota Mill, the largest single mill in North America, is now -15c per 1/5 below 14 pro and not accepting anything below 13.0 protein. Most, if not all, US flour mills have higher pro flour sold through the next few months (or longer) and it takes 60-120 days, depending on the mill, to change their grinds over to a lower protein flour, while at the same time maintaining high-quality flour and maintaining relationships with their flour customers.
Right now, we are +12/-15. For 12-protein wheat, that’s a $1.50 discount compared to 80c last year. With low cash prices already, we know this is tough to deal with. The core protein issue is that until flour mills find ways to use lower protein, we don’t have any outlet to ship this wheat out in the next 60 days. This requires us to use up storage that we need to keep for the soon-to-be-harvested soybean and corn crops. This is the same situation you are dealing with on the farm.
We expect protein discounts to improve as we get past the harvest season (end of the year). By this time, the flour mills and exporters will have had some time to adapt to the lower protein levels on their side.
Falling Numbers & Vomitoxin: Falling numbers and Vomitoxin testing are being done on a “daily composite" basis. A daily composite means that we take a small portion of every truck sample you deliver and save it in a bin dedicated to your farm. At the end of the day, that sample built out of every load you delivered is tested for Falling Numbers and Vomitoxin at Northern Plains Grain Inspection in Grand Forks. Elevators and producers are overwhelming NPGIS with submitted samples. At times, results are 2-4 days later than normal. Please have patience as we are attempting to give you the most accurate grade possible.
NPGIS charges $35.00 FOR a DON (Vomitoxin) test. A falling numbers test is $15.00 per test. A damage identification test is $10.00 per test. Valley United has absorbed the cost of these fees on all of our submitted samples.
We believe it is unlikely that testing procedures won’t change on the 2024 crop.
Falling Numbers: The heavy rains August 14th -15th on ripe wheat produced some sprout damage. Sprout damage generally brings with it a reduction in falling numbers. Falling numbers is a test that helps identify the structural integrity of the starch chains in wheat. When sprouting occurs, the alpha-amylase enzyme begins to break down the long chains of starch into simple sugars. This impacts the quality of bread, cookies, crackers, and other items made from wheat. Before the mid-August rains, the first wheat harvested was over 300 falling numbers. The wheat harvested immediately after those rains was 25-125 lower. One unique aspect of Falling Numbers: A 100 fn sample and 300 fn sample blended 50/50 results in a sample of 138 fn. As you get lower and lower falling numbers, it becomes harder and harder to blend. Blending fn on the farm is a high-risk activity, potentially destroying your good and high falling numbers inventory. Falling numbers does not blend like protein!
Damage: We are required to stay below a 1% average damage level on train shipments. Any cars over 0.9% are discounted and if the train averages over 1%, we generally have to dump and reload some cars to get below a 1% average. So far this harvest we’ve seen roughly 30% or more of the bushels coming in at over 1%. This obviously creates more challenges as we try to bin wheat properly to make grade on outbound shipments. We are working with our partners to find ways to ship a little higher damage.
Where do we go from here?
We know a lot of wheat was binned on the farm and some of it has “issues!
We’re here to answer any questions you have, so please don’t be afraid to ask.
Damon Reitz, Head Merchandiser
Travis Hegg, COO
Paul Coppin, CEO
The 2024 Spring Wheat harvest/crop has been challenging. Markets are near their lowest levels in 5 years. Interest rates are up substantially from a few years ago, and input costs are up. Now we are in the middle of a quality issue that is negatively impacting the value of our wheat crop.
We are all dealing with a large wheat crop with:
1) The lowest protein we’ve seen in the last several years
2) Weather conditions this summer that created fusarium head blight (scab damage) which is the source of vomitoxin (VOM).
3) The 2-4” rain a couple of weeks ago that—for any wheat that was ripe, reduced the test weight and produced sprout damage and a falling numbers issue.
4) Valley United’s inability to store wheat due to the potentially large soybean and corn crop.
Let’s look at each problem:
Protein: So, at the moment, mills are not yet prepared to handle lower protein wheat. We are seeing this at a local level being very evident. The North Dakota Mill, the largest single mill in North America, is now -15c per 1/5 below 14 pro and not accepting anything below 13.0 protein. Most, if not all, US flour mills have higher pro flour sold through the next few months (or longer) and it takes 60-120 days, depending on the mill, to change their grinds over to a lower protein flour, while at the same time maintaining high-quality flour and maintaining relationships with their flour customers.
Right now, we are +12/-15. For 12-protein wheat, that’s a $1.50 discount compared to 80c last year. With low cash prices already, we know this is tough to deal with. The core protein issue is that until flour mills find ways to use lower protein, we don’t have any outlet to ship this wheat out in the next 60 days. This requires us to use up storage that we need to keep for the soon-to-be-harvested soybean and corn crops. This is the same situation you are dealing with on the farm.
We expect protein discounts to improve as we get past the harvest season (end of the year). By this time, the flour mills and exporters will have had some time to adapt to the lower protein levels on their side.
Falling Numbers & Vomitoxin: Falling numbers and Vomitoxin testing are being done on a “daily composite" basis. A daily composite means that we take a small portion of every truck sample you deliver and save it in a bin dedicated to your farm. At the end of the day, that sample built out of every load you delivered is tested for Falling Numbers and Vomitoxin at Northern Plains Grain Inspection in Grand Forks. Elevators and producers are overwhelming NPGIS with submitted samples. At times, results are 2-4 days later than normal. Please have patience as we are attempting to give you the most accurate grade possible.
NPGIS charges $35.00 FOR a DON (Vomitoxin) test. A falling numbers test is $15.00 per test. A damage identification test is $10.00 per test. Valley United has absorbed the cost of these fees on all of our submitted samples.
We believe it is unlikely that testing procedures won’t change on the 2024 crop.
Falling Numbers: The heavy rains August 14th -15th on ripe wheat produced some sprout damage. Sprout damage generally brings with it a reduction in falling numbers. Falling numbers is a test that helps identify the structural integrity of the starch chains in wheat. When sprouting occurs, the alpha-amylase enzyme begins to break down the long chains of starch into simple sugars. This impacts the quality of bread, cookies, crackers, and other items made from wheat. Before the mid-August rains, the first wheat harvested was over 300 falling numbers. The wheat harvested immediately after those rains was 25-125 lower. One unique aspect of Falling Numbers: A 100 fn sample and 300 fn sample blended 50/50 results in a sample of 138 fn. As you get lower and lower falling numbers, it becomes harder and harder to blend. Blending fn on the farm is a high-risk activity, potentially destroying your good and high falling numbers inventory. Falling numbers does not blend like protein!
Damage: We are required to stay below a 1% average damage level on train shipments. Any cars over 0.9% are discounted and if the train averages over 1%, we generally have to dump and reload some cars to get below a 1% average. So far this harvest we’ve seen roughly 30% or more of the bushels coming in at over 1%. This obviously creates more challenges as we try to bin wheat properly to make grade on outbound shipments. We are working with our partners to find ways to ship a little higher damage.
Where do we go from here?
We know a lot of wheat was binned on the farm and some of it has “issues!
- Use your bins AND use your fans: Vomitoxin is a mold, and mold needs moisture. Storing wheat with vomitoxin at higher moisture levels will INCREASE vomitoxin levels. Low falling numbers are caused by wheat kernels wanting to sprout. If you dry out those kernels, they can somewhat stop the germination process. In previous years, we have observed FN to improve with time in the bin—as long as the bin was dry. Cooling wheat down with cold temps also helps. Know your inventory. Please bring samples in, get it tested and we can make a “Plan of Action.”
- Communicate-Communicate-Communicate: Valley United Co-op is going to do the best we can to get you the best price possible for grain. If you have grade information, volume information, or questions – please tell us. The more we know about your inventory, the easier it is to find a home and a good price for it.
We’re here to answer any questions you have, so please don’t be afraid to ask.
Damon Reitz, Head Merchandiser
Travis Hegg, COO
Paul Coppin, CEO