CHICAGO/MANHATTAN, Kan., May 5 (Reuters) - U.S. flour millers were scrambling to find high-protein wheat supplies remaining from last year's harvest amid fears the developing crop, some of which was hit by snow in Kansas this week, could yield lower-quality grain, buyers said on Friday.
Wheat plants in Kansas, where farmers grow the hard red winter variety used primarily for bread, showed signs of nutrient deficiency. The worst-hit fields in the western part of the state could be plowed over due to extensive crop damage.
An annual crop tour of the top-growing U.S. wheat state wrapped up on Thursday, predicting better-than-average yields. But some fields in the western half of Kansas were still covered by snow or had plants that were knocked down, making them difficult to assess.
"There will be fewer bushels around. There are a lot of unknowns, and there is a fear of unknowns," said a milling company employee on the crop tour who was not unauthorized to speak to the media.
Millers on the tour included employees from Archer Daniels Midland Co, Bay State Milling Co, and Ardent Mills, a joint venture between Cargill Inc, CHS Inc and ConAgra Foods Inc.
The tour estimated Kansas wheat output at 281.78 million bushels, down sharply from the U.S. Department of Agriculture's estimate in 2016 of 467.4 million bushels. USDA will make its first forecast for U.S. winter wheat production next week.
K.C. July HRW wheat futures surged to seven-week high of $4.74-3/4 per bushel after the weekend snowstorm. Prices closed on Friday up 5-1/2 cents at $4.50 per bushel.
Protein premiums in the Kansas City cash wheat market soared, allowing holders of wheat containing 12 to 14 percent protein to sell at prices of $5.50 per bushel or more. Premiums for 12-percent wheat on Tuesday gained 53 cents per bushel, the largest such spike in at least nine years, according to CME Group data.
Specific protein requirements are demanded by flour makers to ensure consistency in baked goods.
"I am certainly concerned about protein," said Dave Green, executive vice president of tour organizer Wheat Quality Council.
Buyers already were asking for specific protein bids for December, led by international milling demand for shipments out of the U.S. Gulf Coast export market, a Kansas wheat trader said.
Existing wheat supplies in U.S. elevators remained robust, and abundant global stocks of lower-quality wheat continued to drag on prices.
"Everything sitting in warehouses is generally low-protein. So if we have back-to-back years of low-quality HRW wheat, that's a huge concern," said Tregg Cronin, an analyst at Halo Commodities. (Additional reporting by Theopolis Waters in Chicago; Editing by Sandra Maler)