In formulating their crop plans for a year, growers cite a blend of influences, from climate and planting conditions to commodity pricing, fertility plans and weed and disease management strategies. All play a part in the decision-making process because there has to be some give in those hard-and-fast rules on rotations. Sometimes you have to take what’s on offer.
Anecdotally, farmers have followed the same approach with wheat acres in the past few years, favouring shorter corn-soybean rotations or, in the case of livestock producers, opting for continuous corn. Yet statistically, winter wheat acres have been very stable in the past six years (see Table 1 below), fluctuating within sight of a million acres in Ontario. Only in 2019 did the numbers dip, with 656,100 acres of winter wheat.
Last fall, much of Eastern Canada basked in an early soybean harvest, providing growers with a much longer planting window for winter wheat. The other key influence on expanding acres was the uptick in futures prices on the commodity market, which started climbing last September past US$6 per bushel, approaching $7 by late May.
As often happens, one region’s failure spells opportunity for others, and wheat production, particularly in southern Ontario, may be buoyed by the impacts of dry weather and poor establishment in other parts of the world. The northern Great Plains in the U.S. endured months of dry conditions, particularly North and South Dakota, which are large red spring wheat producers. Those conditions also stretch north into parts of the Canadian Prairies, affecting the status of Western hopes.
“The entire grain and oilseed sector has seen bullish fundamentals, and wheat is no exception,” says Scott Krakar, grain merchandiser with London Agricultural Commodities. “For wheat in particular, much of the world production has had challenges. In recent years, Russia has become the dominant world exporter and their crop has seen poor establishment. They’ve proposed a large tax to slow exports from the region.”
Add the challenges in the Dakotas and Western Canada and poorer production in Europe last year, and it’s a recipe for continued higher prices and an encouragement to maintain wheat acres. But there’s also the accepted norm where corn or soybean markets tend to “bring the other commodities along for the ride,” and Krakar agrees corn prices usually help set a floor price for wheat. It’s a component of global grain supply and most times can’t be viewed independently to determine pricing.
What’s changed with respect to the corn market is a “demand shock” from China, as the country’s hog sector rebuilds its herd following the devastating mass culling to counter the effects of swine flu.
“When wheat supply is questioned, pricing of wheat becomes independent from corn as the market looks to ration supply and prevent wheat from being competitive into feed rations,” says Krakar. “From this discussion, grain prices will stay supported until we see ending stocks of various grains grow, and that could take many growing seasons.”
The dirt on wheat
On the agronomic side, it’s hard to argue with data provided by researchers from the University of Guelph and its Ridgetown Campus. The university has a 40-year study on the effects of rotation versus continuous corn or corn-soybean rotations while the Ridgetown campus has been engaged in similar research during the past 25 years. Both indicate longer rotations are the preferred course, with proven benefits to yield, plant resilience and soil health.
“Profitability of producing any crop is always at the top of growers’ minds,” says Alex Zelem, agronomist with C&M Seeds in Palmerston, Ont. “The prices of all three commodities are high. However, when you look at the long-term crop rotation data (see table 2), there’s a positive yield impact for corn and soybeans following wheat in the rotation. That makes wheat an extremely profitable crop.”
Zelem also believes longtime wheat growers are maintaining their acres because that’s been working well in their cropping systems. He’s found those who return to growing wheat have struggled to get good establishment and survive the winter in previous years. Yet if they planted in good time last fall, it’s likely they had good-looking wheat for 2021, and hopefully will continue to grow it based on that success.
“I encourage wheat producers to be proactive and to be comfortable forward-contracting some crop to generate the best returns,” he says. “Investigating IP opportunities with premiums such as hard red winter wheat provides some generous returns. If growers default to the soft red class and sell it at the elevator pit come harvest, they won’t likely be paid the best price and that can turn them sour.”
“We can't get wheat to pay!”
The profitability and soil health angles are huge, adds Anita Speers, a certified crop advisor with Lakeside Grain and Feed in Forest, Ont. But there’s also what she refers to as “the stark reality of rising land prices.” It’s not as though land is coming available, easily, inexpensively or otherwise.
“A lot of farmers are taking the stance of ‘I have these acres: how can I make them do the most for me?’” she says. “I hope this is a trend that continues to build steam but again, we can list off half a dozen reasons why three crops are better than two. Yes, there’s soil health, yield components, resistance management — and wheat gives you a chance to get some fertilizer spread and break up that workload.”
Speers concedes that if she puts on her business hat and looks at things from the farmer’s perspective or an economics perspective, hearing the answer to “What’s going to pay the bills?” is a key consideration. Soybeans at $15 or $16 per bushel versus $6.50 per bushel for wheat could be a stretch, she acknowledges. But again, there’s a longer-term outlook that needs to be examined: there are opportunities to break weed and pest cycles, or to sell the straw or enhance soil activity through a cover crop. The value goes beyond the harvested grain.
From a long-term resistance management standpoint, wheat provides more options. In a corn program, a grower can use Integrity — a Group 14 and a Group 15 — two modes of action which can also be used in soybeans. By adding wheat into the rotation, it shifts modes of action to a Group 4 or a Group 6, or if there’s no red clover underseeded to the wheat crop, there’s the opportunity to use a Group 27 product.
“It’s a whole new mode of action to manage weeds, so let’s break the cycle of resistance and have the management plan in place,” says Speers. “But not everyone has that long a perspective.”
The research results
If you’re farming in Ontario, chances are you’ve seen or heard of research studies that show the beneficial effect of wheat included in the rotation. From 2009 to 2014, Dr. David Hooker conducted long-term studies on soybean and corn yield response, adding winter wheat (with red clover in some treatments) while also comparing tillage systems. In all rotations, the addition of winter wheat translated into higher yields (see Table 2 above). Similar studies conducted in the past 40 years have yielded similar results.
Although yield is the more familiar and important metric, Alex Zelem, agronomist with C&M seeds, acknowledges the other better-known benefits of adding wheat to the rotation, including enhanced soil health. But there’s also the value of breaking pest and disease cycles — a growing concern for livestock producers dealing with corn rootworm — and the opportunity to introduce cover crops. The post-harvest period also offers a window for soil sampling or double-cropping with soybeans, and creates a good time to make improvements to drainage systems.
“The biggest challenge I see is not necessarily the price of wheat compared to corn or soybeans but more so the success growers have had growing wheat,” says Zelem. “I know some areas of the province have had some challenging years — sometimes it’s winterkill, sometimes it’s too hot and dry at grain-fill. Once growers shift their management practices to produce a strong crop of wheat, they will keep growing wheat because it’s a profitable crop to grow.”