Paradigm Shift

Paradigm Shift

An acreage decline is forcing new ways of thinking about Hard Red Winter wheat.

It’s no secret that hard wheat acreages in Ontario have been declining steadily. Agricorp final fall planting reports indicate that only seven per cent of Ontario’s planted winter wheat acres are coming from Hard Red Winter varieties. That’s not enough, according to many industry experts.

“We want more Hard Red Winter Wheat” says Andy Wilder, head of grain procurement for P&H Milling. “We have noticed the decline in acres over several years and it has led our company to implement a different strategy to ensure we get the grain we need”, Wilder continues, adding that “the domestic milling demand for Ontario Hard Wheats remains fairly constant year to year”.

Whenever there is a shortage in any commodity, people start to change their way of thinking on approaching the market and securing acres. Something very similar happened in the food grain soybean markets many years ago. The market was forced to head down a new path of early grain procurement based on competitive values over domestic crush soybean market values. The model proved successful.

Now, hard wheats appear to be headed down a similar path. Demand for Hard Red has always been very strong for our domestic milling trade. It has been a nice marketplace for Ontario growers to participate in. They grow different classes of wheat and are rewarded based on a premium over our heavily exported Soft Red Winter wheat class. One of the main reasons for a decline in acres was an uncertainty in pricing from year to year, which appears to be solved.

Wilder says the focus has changed at P&H Milling: “We will move forward with programs that offer strong values to the grower and allow us to know what types of tonnages we can expect from year to year,” he says. “The new strategy is working and we are already seeing an impact on Ontario acres.”

Company representatives from ADM Milling have also noted the acreage decline in both the Hard Red Spring Wheat class and the Hard Red Winter Wheat Class. All indications from ADM Milling lead to the development of a similar procurement strategy to others in the industry, noting that the keys to future growth will be competitive values and early acreage booking strategies. ADM will implement their strategy through key grain origination partners in Ontario.

“We want hard wheat, both in the spring and winter classes, and we are not getting enough of it to please our end users,” says Russell McLaughlin, grain merchandiser for Sollio Agriculture. “This is a no-brainer when you look at what is happening. Grow hard wheats, follow our programs and reap some very strong rewards for your efforts.” Sollio Agriculture, will have programs in place reflecting the new strategies implemented by Flour Mills.

All of the above programs are based on three similar factors: a requirement of Certified seed to ensure that end users are getting what they require; strong values compared to the Soft Red commodity; and
early booking for the crop, thereby locking in your values for the season.

Check out what opportunities exist in Hard Red wheats!

About the Author

Tim Meulensteen is a CCA-ON certified Agronomist with C&M Seeds. He lives with his young family at their small mixed farm in Perth County. Tim has enjoyed working in the crop inputs industry since 2001. He obtained his Bachelor of Commerce degree in Agriculture Business in 2004 at University of Guelph.