The price of soft white winter wheat has rocketed past $10 per bushel in the past week, but marketing experts disagree on whether it will remain that high.

The price of soft white wheat ranged from $9.80 to $10.25 per bushel Aug. 17 on the Portland market.

“It really depends on what Australia does,” said Dan Steiner, grains merchant at Morrow County Grain Growers in Lexington, Ore.

“The USDA thinks the Pacific Northwest lost 100 million bushels worth of production” this year because of the drought, Steiner said. “Australia found it. They’re on track right now for what could be a huge crop.”

Australia had a record wheat crop of 1.2 billion bushels last year. This year’s crop is estimated at 1.1 billion bushels. That nation grows hard and soft varieties and exports up to 75% of its total production, according to the Australian Export Grains Innovation Center.

USDA’s Aug. 12 World Agricultural Supply and Demand Estimates report projected U.S. soft white wheat production this year would be 214 million bushels, down 29% from 302 million bushels last year.

USDA projections translate into about a 93.2 million bushel crop for Washington state, the smallest since 1973, said Glen Squires, CEO of the Washington Grain Commission.

The state’s 2020 crop was 165.6 million bushels, according to the commission.

“Tighter supplies from reduced production certainly adds to price strength relative to demand,” Squires said.

“With constrained supply this year due to tight stock carryover plus the reduction in production with the drought impacts, we are seeing the strength of that price,” said Amanda Hoey, Oregon Wheat CEO, adding that higher prices are “important for producers in this year of low production.”

Australia could still experience production problems, Steiner said.

“If they have a hiccup, if they have hot weather come in, if it quits raining, or anything like that, we’re certainly, certainly going to go higher,” he said. “If Australia stumbles … we could be at $15 in very short fashion.”

However, soft white wheat prices would have a tough time rallying any higher if Australia’s crop continues at its current pace, Steiner said.

At the same time, the market is short enough that Steiner doesn’t see a lot of downside for prices.

Another expert believes prices won’t remain at their current levels for long.

Omaha, Neb., market analyst Darin Newsom expects prices to snap back lower, like a rubber band. The market could drop by a dollar, he said.

“We did go to a new contract high late last week,” he said. “That normally doesn’t last long. When that rubber band breaks, it snaps back to its base, which is fundamentals, and so we see the market sell off.”

Fundamentals include acres planted, yield and demand. Newsom wants to see them get more bullish, prompting investors to believe the market will go higher.

The export market could heat up this year if — “and it’s a huge asterisk” — USDA projections about a drop in global wheat production prove correct.

Newsom said he is not yet convinced supplies are tighter, except for high-protein hard red spring wheat.

“Markets are going to be searching for some protein wheat, anything right now,” he said, adding that “there’s just not going to be a lot of spring wheat, in Canada or the U.S.”

Soft white winter wheat discounts for high protein due to heat stress will likely remain, he said, since higher protein isn’t as desirable for products made using that particular wheat class.

Steiner estimates the Pacific Northwest lost 30% to 50% of its wheat production this year due to heat and drought, depending on the area.

The market will figure out a way to use any wheat, he said, even the wheat with higher protein caused by heat stress.

“Right now they max out discounts at 60 cents,” he said. “You’re looking at $9.40 wheat. What’s wrong with $9.40 wheat? That’s a good number.”