Ontario wheat buyers are looking to reverse the significant decline in hard red wheat acres in the province, with better offers and the long-term potential of an identity-preserved system for desired varieties.
Ontario’s wheat market moved over the past five to 10 years to a predominantly soft red wheat. In 2018, soft red wheat made up about 89 per cent of the acres in Ontario.
That means only a sliver of production in hard red wheat. Final fall 2018 planting numbers from Agricorp show just seven per cent of the wheat acres in Ontario were sown to hard red wheat, although that is stable with the previous year.
Why it matters: Hard red wheat is favoured by bakers, especially for bread. A lack of production in Ontario means that it is difficult for bread producers to stake a local food claim.
About 60 per cent of western Canadian wheat production is hard red spring wheat, and it has become a staple for Ontario millers, with its consistency and higher protein levels, compared to Ontario hard red winter or spring wheat.
The soft red wheat market grew strongly in Ontario supplanting hard red wheat, said Rob McLaughlin, of C&M Seeds, a major supplier of wheat seed in Ontario.
With that demand, and concerns about the greater challenges of growing hard red wheat in Ontario, including getting consistent protein levels, farmers made the logical choice to move away from growing hard red wheats. Elevators were making their lives simpler by reducing the different types of wheat they handled.
McLaughlin said that in his discussion with buyers including P&H Milling and ADM Milling, they expressed concern about the lack of hard red wheat available.
“Our straight comment to them was that they had to signal to growers that you want this,” said McLaughlin.
There needs to be a premium and consistency in demand to grow the hard red wheat market.
That’s starting to emerge, says Scott Krakar, wheat merchandizer with London Agricultural Commodities (LAC).
“We are currently seeing very large demand for locally grown, both hard red spring and winter wheat,” he said. “There’s a large desire to increase acreage of locally grown hard red wheats.”
Krakar didn’t have any pricing to share on hard red wheat, but he did say that with a lot of American spring wheat acres under water with the flooding in the U.S. northern hard spring wheat growing areas, hard red spring wheat prices have rallied.
McLaughlin says that the direction for hard red wheats will be similar to the development of identity preserved (IP) soybeans for food in Ontario. IP wheat, with specific quality and management parameters as well as premiums, would make sense for the sector to encourage more production.
Krakar says that is the direction wheat is headed, but he doesn’t see it happening soon, as currently hard red wheat varieties are commingled with little identity preservation by variety.
“It’s in its infancy and it will take time to develop (an IP wheat system). That’s the goal and it will be achieved. How fast that all evolves depends on the uptake by the producers.”
A burdensome glut of U.S. soybeans caused by a decision by China to reduce its purchase of U.S. soybeans could mean that hard red spring wheat will make sense for some growers, especially in more northern areas of the province, says Krakar.
“There should be good demand for hard reds. Crush soybean demand might not be so robust.”
One of the reasons farmers moved away from growing hard red wheat was that the varieties available were not consistent, especially when it came to protein level, which determines what price farmers get for their wheat.
Krakar says that farmers need to make sure they are planting the varieties that will give them the best protein price premium.
McLaughlin says that compared to 10 years ago, when the hard red wheat numbers started to decline, the varieties have improved, with more consistent protein numbers and better yield.