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Winter wheat measures up economically in the Parkland

Look at more than the Pool Return Outlook when assessing wheat.


November 15, 2007
By Bruce Barker

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When considering crop rotations with winter wheat, the temptation is to look
at yields and multiply by price and decide if winter wheat can compete with
hard red spring wheat. But there is far more to winter wheat than gross return.

"I don't even know why people try to compare spring and winter wheat.
They are two different crops just like canola and peas," says Ron Heller,
agronomist with Alberta Reduced Tillage LINKAGES (RTL) at Vermilion, Alberta.
"The economic benefits of winter wheat are spread throughout the rotation
and should be measured on their own merit."

Heller says when considering winter wheat, the assessment should go beyond
gross returns to look at the cost of growing the crop, the reduced risks, and
the final net return. "Winter wheat spreads its economic benefits throughout
the rotation and should be assessed in that light."

In fact, even when just considering grain prices, winter wheat comes close
to hard red spring wheat. With a premium paid for high protein for Canada Western
Red Winter Select varieties, high quality winter wheat prices are similar to
a #2 CWRS return. Depending on how consistently high quality CWRS can be grown,
winter wheat starts to look pretty good in the Parkland.

At Vegreville, Alberta, farmer Ken Farion likes those odds. He says that in
his area of the Parkland, #3 CWRS wheat is common. "We were lucky for five
or six years in this area, and were growing #1 and #2 spring wheat, and came
to kind of depend on getting that. This year we are back to #3 and feed. We
typically can grow a good crop of spring wheat here, and then lose our grades
at harvest."

Farion, who was awarded the Alberta Conservation Tillage Society (ACTS) Farm
Family Award at FarmTech 2005, first tried growing winter wheat in the early
1990s, and then quit because he did not feel the varieties were good enough.
Then, in 2002 he gave it another try. His main objective for getting back into
winter wheat was to grow a fall cereal that would beat the fall frosts and bad
September harvest weather, as well as to help spread out the harvest. Farion
felt that with better winter hardy varieties, more accurate seed placement and
low disturbance seeding, the chance of winter wheat success would be greater.

During the fall of 2002, he made the commitment and obtained seed with the
help of Ducks Unlimited. "The most important step with winter wheat is
to make the commitment by purchasing seed and having it in the yard. Once you
do that, it motivates you to get it seeded."

Farion seeded with his Conserva Pak no-till drill with 12 inch row spacings
on September 14 and 15, 2002. Within a week, he had nice rows of winter wheat
emerging; and at freeze-up, the wheat was in the three leaf stage. The land
stayed bare for a couple of months before snow cover came that lasted until
mid-April. The growing season had 12 inches of moisture by mid-August. Harvesting
took place during the last week of August with a yield of more than 70 bushels
per acre and protein content around 14 percent.

With returns that rivalled spring wheat, Farion planted 700 acres in the fall
of 2003, for harvest in 2004. Despite the cold spring and summer, the crop was
ready to rival the previous one. Then the August and September rains started.
"We lost all the harvest advantages of winter wheat by two days. We were
two days away from starting to harvest the winter wheat when it started to rain."

Still, Farion was able to eventually harvest a winter wheat crop that varied
from 40 to 70 bushels per acre with grades ranging from feed to #2. "2004
was a bad harvest year, as we all know. I think, though, that winter wheat should
still be harvested on a regular basis in August, which can't be said for spring
wheat."

Economic benefits add up
Heller says that by being able to utilize the combine when it would normally
be sitting idle is one of the reasons farmers in the Parkland are taking another
look at winter wheat. With harvest spread out over a longer period of time,
rather than adding additional harvest capacity in the shape of additional iron,
using the combine for more hours helps to spread out the capital costs. Plus,
with some of the seeding done in the fall, more land can be farmed without squeezing
spring seeding.

"The pressure to have more land in production is huge because of economics.
With direct seeding, there is the potential for more winter wheat acres in the
Parkland. If you can put 20 percent of your land in during the fall, that can
open up the window for more timely seeding of peas and canola in the spring.
If canola is seeded 10 days earlier, it is usually a better crop. And with a
wider harvest window, you'll not only get winter wheat off sooner, but the spring
crops may be harvested earlier, because they were planted earlier," says
Heller. "Maybe you won't need two combines. Maybe you can get more acres
out of the same machinery. Those are real cost savings that can be achieved,
just by changing one crop."

Farion says that seeding in the fall is stressful, especially if the combine
should be running at the same time, but that with good planning, it can be accomplished.
He says that you need to work with your supply chain to ensure that all the
crop inputs are ready. Farion and another neighbour worked with their local
fertilizer dealer to ensure that anhydrous ammonia would be available: dealers
might not have truck drivers ready to go in early September.

On the input side, Farion says his risk is also lower than spring wheat. During
the fall, his anhydrous ammonia costs have been 20 percent less expensive than
the spring – for a savings of $10 per acre. Wild oats are typically not
a problem and can save another $15 dollars per acre. In 2003, his winter wheat
was higher quality, with just as good of yield as the spring wheat. All told,
Farion believes his net economic benefit from winter wheat over spring wheat
was approximately $50 per acre in 2003. While his 2004 crop did not pencil out
as well, he is still committed to winter wheat.

Unfortunately, Farion, like many other Parkland growers, did not get any winter
wheat sown during the fall of 2004. With the late harvest, none of the land
he had targetted was harvested in time for seeding winter wheat. Usually, Farion
has pea or barley land harvested in late August and ready for seeding. But he
remains committed to giving winter wheat another shot in the fall of 2005 and
says that with the right goals in mind, winter wheat can work in the Parkland
of Alberta.

"If I am growing a crop for feed, volume is my goal. But if I am growing
it for milling, I must work towards yield, protein and quality. I got into direct
seeding to help reduce crop production risk. Winter wheat is another step in
helping to reduce risk so that I can more reliably reach my goals." -30-