With about half the acres planted than were estimated in March, durum production will be down significantly in 2011. That news pushed durum prices higher and, as it looks now, durum prices seem to have nowhere to go but up, according to Erica Olson, marketing specialist for the North Dakota Wheat Commission.
"We're seeing cash prices surpass $15 per bushel. Around the state prices are ranging from $14.50 to $15.25 with an average of $15," Olson said. "That's obviously because there won't be as many durum acres planted as originally thought."
As of June 19 only 44 percent of North Dakota's durum crop had been planted, according to USDA's crop progress report.
"And it's very likely we didn't see any progress after that because it's getting quite late to be planting and we've also had a lot of rain in the main durum growing region in the last few days," Olson said.
"There were probably still some producers who wanted to plant more, but with more rain and additional flooding they likely weren't able to."
In the northwest part of the state - the largest durum producing region in the country - only about 21 percent of the crop had been planted.
"The March acreage number was 1.6 million acres. I'd say we'd be lucky if half that acreage was planted this year," Olson said.
Montana producers were a little better off, getting about 90 percent of their durum crop planted.
"Obviously we'll be looking at a much lower U.S. production number," she said. "Last year's production was 107 million bushels, so we could see it drop down to about half that."
The situation is pretty similar north of the border in Canada. Back in March Canada was estimating a fairly large increase in durum acres up to 5.1 million acres, however the Canadian Wheat Board recently revised its estimate down to 4.0 million acres. That's a significant drop and also well below average.
The CWB's early season production estimate is 140 million bushels which is an increase over least year's low level, but still below average, which would be closer to 180 million bushels.
The Stats Canada acreage report which came out June 23 indicated a new estimate of 4.4 million acres, but since that survey was taken early in the month even that report may not reflect the actual acreage.
The European durum crop has been getting some rain lately after struggling with drought conditions for several weeks, but some analysts say it's too late to help the crop and their durum production is expected to be six percent lower, according to Olson.
Olson also noted that overall durum supplies will be lower this year, adding that Canadian stocks were drawn down quite a bit last year, but carryover stocks are fairly plentiful in the U.S.
"We're sitting at about 39 million bushels in carryover stocks, so that will help the situation somewhat, but the big issue will be quality and what type of quality the buyers are going to be demanding," she said.
Harvest is still going quite well in the U.S. desert durum area, so the production situation there is looking fairly good, except for most of that is already contracted, Olson noted.
"Right now a lot of the pasta manufacturers likely have their near term needs covered, but we're likely going to see supplies get tight once we enter the second half of the crop year," she said.
On the export side, sales so far total just over six million bushels. That's down compared to last year's pace of 10 million bushels, Olson said, but added it's hard to compare to last year because the U.S. started out with heavy exports right away and then slowed down.
"This year we're starting off slower, but that's not shocking given the price increase we've seen lately," she said.
"There's obviously a lot of supportive news for durum prices right now, but at same time it's uncertain. We could reach a point where we're pricing ourselves out of the market," she added.
"So a lot depends on what the U.S. and Canada produces and how much buyers are still willing to pay."