Another factor to watch is wheat exports from Russia, Ukraine, and Kazakhstan. Both Russia and Ukraine, especially Russia, have the goal of becoming major exporters. These countries produce hard wheat that competes with U.S. hard red winter wheat. Reports also indicate that Russia has been undercutting the world wheat price by $0.75 to $1.25 per bushel.

The U.S. and the world have about an average supply of wheat, and prices are relatively high.

Farmers, everywhere in the world, react to high wheat prices by increasing planted acres. If the weather cooperates, wheat production for the 2012/13 marketing year will be above average and 2012/13 prices will be lower than current prices.

Hard red winter producers in the Southern Plains need to insure production and income first. Because of yield uncertainty, price will probably not be a factor until a few months before harvest or when the wheat is in the bin.