Wheat Storms Higher after Snow

Last weekend, a massive snowstorm dumped up to 20 inches of snow on western Kansas and nearby states. This late-season storm devastated wheat fields as snow smashed emerging plants and below-freezing temperatures threatened to damage plant growth.

Kansas grows 20% of the U.S. wheat crop, and this storm could reduce production by over 50 million bushels. The extent of damage is unknown so far, but crop watchers are scrambling to assess the destruction.

Markets initially exploded on the news, with Kansas City wheat prices gaining almost 40 cents per bushel by mid-day Tuesday. By week’s end, the fears of crop loss and prices had subsided substantially, partially since the world is awash in wheat, which will allow the global supply to cover the potential losses.