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Grain prices up, production down

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Fargo,North Dakota 58102
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Grain prices up, production down
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While July's heat was good for sun-seekers and water lovers, it wasn't so great for the region's wheat crop, according to reports released by the United States Department of Agriculture and the North Dakota State University Extension Service over the last few weeks.


Durum wheat production was down 40 percent, and all other spring wheat was down about 8 percent, thanks to a hot, dry July that drastically reduced yields in most places, especially central and western North Dakota.

According to the USDA, durum wheat production is forecast at about 60.4 million bushels, down 40 percent from 2005. That's partly due to less acreage dedicated to durum, which is selling considerably lower than spring wheat on the market at under $4 per bushel.

Spring wheat, meanwhile, has hit big highs over the past four months, thanks to hot, dry weather across much of the breadbasket of the United States. Farmers with good crops are excited to hear about wheat selling locally at $4.75 to $4.95 per bushel, and prices up over the $5 range in the Minneapolis area.

The seasonal average for wheat will be about $3.70-$4.30 per bushel, up from $3.42 each of the last two years. That price includes durum.

Acreage was up in spring wheat more than 4 percent from last year.

Ending stocks of wheat are projected to be down about a quarter from a year ago, but still rolling in more than 400 million bushels. Some wet, cooler weather that hit at the end of July and in early August has helped those who haven't cut their wheat.

"We're going to see the crop size reduced as we go along thanks to the hot, dry weather, but it might not be as bad as some projected," George Flaskerud, crops economist at North Dakota State University Extension Service, said. "And the price increases may not be over, considering the weather forecast."

Futures were doing very well, as those planting winter wheat for next year were trading very high.

Those with solid crops will be able to cash in, as Dakota Ag Cooperative's West Fargo, Horace and Harwood sites were taking in truckloads all week long. Many farmers are looking at decent yields in some of the Cass County area thanks to timely rains, but July's heat did put a pinch on things and farmers won't likely see the record yields of 38 to 30 bushels per acre for durum they saw as recently as 2003.

Durum took perhaps the biggest hit. In fact, the USDA is putting durum yields at about 33 bushels per acre, down more than four bushels from the 2005 growing season, which saw extremely wet conditions in the southern end of the Red River Valley wipe out some wheat fields in June. However, farmers who weren't wiped out by deluges were able to bring in huge harvests thanks to a relatively average summer.

This summer, April's floods gave way to very dry months in June and July. That was primarily responsible for dropping yields by nearly 10 percent.

"If realized, this will be the lowest harvested area for durum since 1961 and the lowest production since 1988," the Ag Statistics Board reported last week.

Winter wheat production will top out at about 1.28 billion bushels, the report said, 15 percent below the harvest of 2005. Nationally, winter wheat yields look to be about 41.1 bushels per acre, down about three bushels from last year and way below records set in 2003 and 2004, where yields were up over 45. Spring wheat this year will bring in yields of 33 bushels per acre, down from about 37 last year.

Barley yields were also off, with yields reduced to about 63.4 bushels per acre. Prices were hovering near last year's average, with sales at $2.45 to $2.85 locally. That's near the price of $2.53 given last year.

Corn, seen as this area's contribution to the energy crisis, will have a huge year in terms of acres planted and price, up more than 30 cents from last year. However, much lower yields (dry weather) and more corn dedicated to feed will hurt the overall crop.

For more information, visit the National Agricultural Statistics Service at