UPDATE 2-TOUR-Kansas wheat crop seen down 18 pct after drought, cold spring

Thu May 2, 2013 6:51pm EDT

(New throughout, updates prices, adds more comments from analysts, details)

By Julie Ingwersen

KANSAS CITY May 2 (Reuters) - Wheat yields and harvested acreage in Kansas will be hard hit by drought and recent cold weather that has hindered crop development in the biggest U.S. wheat state, scouts on an annual tour said.

Scouts estimated total wheat production in the state at 313.1 million bushels, down 18 percent from 2012. Yield prospects in Kansas averaged 41.1 bushels per acre, according to the Wheat Quality Council which led a three-day tour of 570 fields across the state that ended on Thursday.

The low production forecast implies expectations that farmers will abandon 18 percent of their planted acreage, twice as much as usual, due to poor crop conditions.

"The potential for abandonment is going to be much higher than normal and it's mainly in the western part of the state where drought and freeze caused major problems," Jim Shroyer, extension agronomist with Kansas State University who was on the tour, told Reuters.

Kansas farmers planted 9.3 million acres of winter wheat, one-fifth of total U.S. winter wheat plantings, last autumn in the midst of severe drought conditions. Kansas grows hard red winter wheat - used to make bread and the largest wheat variety produced in the United States - the world's top wheat exporter.

"Without good weather, reasonable temperatures and a fair amount of rain, these numbers could fall," said Darrel Nelson, a participant on the tour with Bay State Milling.

Dry soils have plagued the Kansas wheat crop since planting last fall. One farmer in western Kansas told tour scouts that his fields have received just six inches of rain over the past two years.

Before the tour started, analysts had been expecting wheat yields to be 39.4 bushels per acre, according to the average of estimates in a Reuters poll.

Ben Handcock, executive vice president of the Wheat Quality Council, said the devastation wrought by drought was more significant than he had expected. Wheat plants are very short and far behind normal maturity levels for this time of year.

"I've never seen one like this," he said, adding that the recent rains and snows have not helped the crop recover much.

Kansas City Board of Trade July hard red winter wheat futures, the first contract to reflect expectations for new crop production, closed up 8-1/2 cents at $7.90-3/4 a bushel on Thursday. Prices have gained 5.4 percent so far this week, hitting a 2-1/2 month high on Tuesday, as reports from the field hit the market.

"There is some average to above-average wheat in the central to eastern part of the state. But in the southwest corner of the state there are a lot of tillers on those plants - but there is not a root system under those plants to support those tillers," said Mark Hodges, executive director for Plains Grains, a wheat testing company based in Oklahoma City.

More than 80 percent of the state was still experiencing severe to exceptional drought, state and federal climatologists said in their weekly "Drought Monitor" report issued on Thursday. A year ago, only 2.36 percent of Kansas was suffering from severe to exceptional drought.

Cold conditions also battered the crop throughout the spring, with temperatures again dipping to the 20 degrees Fahrenheit (6.7 Celsius) range on Thursday morning.

Crop scout Aaron Harries with the Kansas Wheat Commission said there is plenty of downside yield potential for the western third of the state while the central Kansas crop could improve.

"But most of Kansas tonight is in a freeze warning - here we go again," Harries added.

Winter wheat can withstand freezing temperatures during the winter, when the crop is in its dormant stage, but freezing can reduce wheat of its yield potential after plants emerge from dormancy in the spring.

The Kansas wheat crop last year made up about 17 percent of total U.S. wheat production. The next biggest grower, North Dakota, produced 339.2 million bushels, or 15 percent.

In 2012, the tour pegged the Kansas yield at 49.1 bushels per acre and total production at 403.8 million bushels. The five-year tour averages are 42.3 bushels per acre and 341.3 million bushels, respectively.

The U.S. Department of Agriculture reported the final 2012 average yield for Kansas at 42.0 bushels per acre and production at 382.2 million bushels.

The winter wheat crop in Kansas was rated 27 percent good to excellent as of April 28 by USDA, the sixth lowest rating on record for that time of year.

The last time Kansas wheat was in worse shape at this point in the growing season was in 2011, when the crop was rated just 21 percent good to excellent. Final yields in the state that year were 35 bushels per acre, a 22 percent drop from a year earlier and below that year's tour estimate of 37.4 bushels per acre. (Writing by Mark Weinraub. Additional reporting by Sam Nelson, Karl Plume and Christine Stebbin in Chicago and Carey Gillam in Kansas City. Editing by Jim Marshall and David Gregorio)

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