The 38 Million Dollar Freeze in Kansas
Late Sunday night into Monday morning last week, below-freezing temps hit much of the southern plains, including top-wheat producer Kansas. FBN wanted to examine whether or not this impacted wheat yields in the area. To do so, FBN looked at historical data including minimum temperatures in April by county, final yields by county, and the amount of the crop that was jointed across the state when minimum temperatures hit.
We collected data based on the following from 1981 forward, assuming the state crop is at least 20 percent jointed:
Minimum temperatures by county
Yield per acre by county
Assumed harvested acreage was in line with 2019 by county
Assumed a cutoff of 20 percent jointed, as that was the state-reported total as of April 5, 2020
Looked at temps at or below 24 degrees Fahrenheit (based on research from Kansas State University, the 24 degrees mark when the crop is jointing can cause death of a plant with moderate to severe yield damage)
The impact of recent cold temps
The data showed that for every degree below 24 degrees Fahrenheit, it can reduce potential yields by 0.4 bushel per acre when the crop is at least 20 percent jointed. In other words, if the temperature drops down to 20 degrees, that would translate into a 1.6 bushel per acre yield loss if the state crop is at least 20 percent jointed. One warning is that the colder temps were farther north where the crop is likely not as developed as the crop in the southern portion of the state. But, there is also a flip side to that—where the crop is further developed, cold temps can cause more harm. The following map shows potential losses in Kansas wheat yields based on the recent cold snap over April 12-13.
The final impact is light
Based on these assumptions, we calculated that the state yield loss due to the recent cold temperatures could be about 1.4 bushels per acre. Using the historical average of harvested area of 90 percent and USDA’s March Kansas winter wheat planting total of 6.8 million acres, the potential loss to the crop is near 8.5 million bushels. Putting this in economic values, that translates into about $38 million dollars of crop losses for the state at $4.50 HRW wheat.
What this means for the U.S. farmer
The bottom line is that while the unseasonal cold snap did cause some harm, it is not enough to move the needle significantly from a U.S. HRW balance sheet standpoint. Futures reacted positively in the overnight session on Sunday into Monday morning, but soon lost those gains. Moving forward, moisture will be key during the month.
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