At this writing, Oklahoma local elevator wheat prices range between $4.62 (southern) and $4.93 (northern), and in the Texas Panhandle, prices are around $4.67. The odds of $6 wheat during the next six months in Oklahoma and Texas are about 10 percent. But, miracles do happen.

In mid-July 2011, the price of wheat was $6.71. The price had been $8 in mid-June. A producer called wanting to know if the price of wheat would go back up to $8. I told him there was about a 20 percent chance. On August 31, the price was $8.50. By September 23, the price had declined to $6.86, and the price remained in the $6.42 to $6.80 level for the next six months.

In mid-June 2012, the price of wheat was $5.99. By July 20, the price had increased to $8.93, and then prices remained in the mid to upper $8 range until early December.

In mid-June 2015, wheat prices were near $4.75 in central Oklahoma and near $4.45 in the Texas Panhandle. (The Oklahoma/Texas price spread has remained about 30 cents). Central Oklahoma prices peaked on July 1 at $5.55 and at this writing, have fallen back to $4.65.

Note that in both 2011 and 2012 prices stabilized in the late August to early September time period and remained in a plus or minus 30 cent range throughout the remainder of the year.  A review of the 2012/13, 2013/14, and 2014/15 wheat marketing year price movements show that prices stabilized from late July to early-September.

Price variability for the last three months has been the result of the financial markets, the grain supply and demand situation, and the commodity funds and commercial traders’ market positions.

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The financial and political situation in Greece and the European Union and the economic slowdown in China have affected the value of the dollar compared to other currencies. On June 2, the index of the dollar to other currencies was 98.3. The index fell to 93.3 on June 21 and was back down to 93.3 on July 18. These changes reflect a 5.4 percent swing in the value of the dollar and wheat prices (27 cents).

At this writing, about 60 percent of the world’s 2015/16 wheat marketing-year wheat has been harvested. In India, Pakistan, Northern-African, and China, winter wheat harvests are complete.

The U.S. winter wheat harvest is about 80 percent complete. Spring wheat will be harvested in Canada, China, and the European Union July through September. Wheat will be harvested in Argentina and Australia in late October through December.

As a higher percentage of the harvests are completed, the price impact of harvest expectations decline. On August 1, 63 percent of the world’s wheat will have been harvested. The percentage harvested increases to 84 percent by September 1.

The third market factor affecting prices is the commodity market funds and commercial traders. They analyze the financial and supply and demand situations and invest billions of dollars buying or selling commodity futures contracts.

For example, reports are that in a recent 22-day period, market funds bought 314 thousand corn contracts (1.57 billion bushels). The CBT December corn contract price increased from $3.65 to $4.64. The funds were not the lone buyers. Feed mill and corn exporters (commercial traders) were also buying contracts. The increased demand may have been due to a change in supply and demand expectations.

Oklahoma and Texas wheat prices are expected to stabilize (if you call plus or minus 25 cents stable) within the next six to eight weeks. The odds of wheat prices stabilizing in the $6 range is about 10 percent. The odds of wheat prices stabilizing in the $5 range is about 50 percent.