Hard red winter wheat basis bids were firmer on Tuesday with good demand seen. US winter wheat harvest was about 22 percent completed as of Sunday, according to the USDA. About 42 percent of the winter wheat crop was rated by USDA as in poor and very poor condition as of Sunday.
Hail storms followed droughts in some areas of Kansas to further deplete production in that key growing state. One issue with newly harvested wheat off dry land acres is the size of the crop's kernels, also called "berries." This year's harvest is seeing kernels that are not as large and round as is desired. As a consequence, millers may need to buy more bushels to get the same flour yield as they would if the berries were plump, which can add significant costs to millers.
As the new bushels start coming into the bins, quality as well as quantity is closely watched by millers and bakers. Protein levels are running higher than normal because the heat and lack of rain cause significant stress on the crop, which triggers more protein production.
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