Mixed blessing for durumDurum prices have soared this fall, but that won’t put much extra money into the pockets of many North Dakota durum producers.
By: Jonathan Knutson, Agweek
Durum prices have soared this fall, but that won’t put much extra money into the pockets of many North Dakota durum producers.
The same wet weather that helped to push up prices has hurt durum quality, leading to discounts, or price reductions, that offset much or even all of the higher prices, industry officials say.
“The discounts can be pretty significant,” says Erica Olson, marketing director with the North Dakota Wheat Commission.
The size of the discounts varies from one elevator to the next, and it’s difficult to estimate how much the price reductions are costing farmers, she says.
North Dakota leads the nation in production of durum, accounting for 56 percent of U.S. durum last year, according to the North Dakota office of the National Agricultural Statistics Service.
Most North Dakota durum is produced in the northwestern part of the state.
This year’s crop benefitted from good growing conditions, with yields pegged at 39.5 bushels per acre, which would top the previous record of 39 bushels per acre set in 2009.
But heavy rains in September, when durum was being harvested, have hurt durum’s quality.
Keith Deutsch, a Plaza, N.D., farmer and first vice president of the U.S. Durum Growers Association, says a small amount of his late-planted, rain-damaged durum wasn’t even worth bringing to the elevator after harvest.
In early September, durum fetched an average of $4.87 per bushel at area elevators surveyed weekly by Agweek.
The average price at those elevators earlier this month had risen to $6.12 per bushel.
Also helping durum prices are production problems in Canada, the world’s leading durum producer.
Statistics Canada has estimated the country’s 2010 durum crop will be 42 percent smaller than the 2009 crop, reflecting the wet spring and planting delays this year.
Reports of quality issues in Europe are boosting the outlook for U.S. exports to Europe and North Africa, the leading markets for U.S. durum, she says.
Italy is the leading importer of U.S. durum, followed by Algeria, Nigeria and Morocco, according to the North Dakota Wheat Commission.
Durum is used to make couscous, a staple of North African diets.
Deutsch says he and other U.S. durum producers shouldn’t focus so much on short-term price swings that they lose sight of durum’s long-term potential.
“I still like the outlook for our crop,” Deutsch says.