August 31, 2008 in City

Early wheat optimism rings hollow

Farmers watch as erratic weather delays harvests, diminishes yields
By The Spokesman-Review
 
CHRISTOPHER ANDERSON photo

Spilled grain fills a rain puddle left from a storm that passed through the Reardan area Wednesday.
(Full-size photo)

On the Web: Find previous coverage and video packaged with this story at spokesmanreview.com

REARDAN – Wheat farmers are becoming anxious as much of this year’s crop stands uncut in the rolling fields of Eastern Washington. The harvest is running about two weeks behind schedule as night temperatures cool and rains last week further postponed plans to start the combines.

It’s one more frustration in what has become a disappointing year for farmers and landowners – the same people who were filled with optimism last winter, as record-setting grain prices offset worrisome increases in fuel and fertilizer costs.

Wheat is one of Washington state’s most important crops and an economic engine in Eastern Washington. Last year the value of wheat production in the state was $625.8 million, according to the Washington Wheat Commission.

Farmers enjoyed a decent harvest and profit last year as prices rose, though many locked in contracts and thus settled for prices in the $5- to $7-a-bushel range. Only a few were able to sell in the winter, when prices topped out at $15.68 a bushel. That price doesn’t include the cost of transporting the wheat, often calculated at between 50 cents and 80 cents a bushel. Such prices left farmers seeking an even better year in 2008, as many chose to avoid signing large fixed-price contracts in hopes of catching the next spot market price run-up.

But as summer closes, the wheat crop is smaller than expected. Spring wheat and barley acreage were the worst. And farmers hoping for another profitable year are disappointed.

“Yeah, it’s a pretty dismal production year,” said Keith Bailey, chief executive of AgVentures NW LLC, which manages the Odessa Union Warehouse Cooperative and Reardan Grain Growers.

The snowy winter meant many farmers had to seed their spring wheat crop later than usual. In some cases they were punching seed through the snow and into the soil.

When many of the 600,000 acres of spring wheat emerged, they were greeted by an unsettled weather pattern that delivered scorching hot temperatures one week followed by frost the next.

The all-important winter wheat crop fared better, but farmers are reporting below-average yields across the state, said Tom Mick, CEO of the Washington Grain Alliance.

Yields in the Odessa area, a broad swath of farmland west and southwest of Spokane, were poor. Some farmers reluctantly ran diesel-guzzling combines across fields that bore fewer than 10 bushels to the acre. That’s a big money loser even with high wheat prices, currently running a little more than $8 a bushel.

“I hate to say it, but it was a perfect storm for a bad crop,” Bailey said. “Hopefully farmers had crop insurance, though that’s fairly expensive, too.”

A bright spot is the quality of the wheat, he said.

Last week, Kurt Carstens could only wait as his combines sat parked in fields north of Reardan, stymied by rain and cool temperatures. Carstens said he’s cut only about 10 percent of his wheat. He has little hope for his spring crop, but expects his winter wheat numbers to be closer to average.

If forecasts calling for warm, dry temperatures this weekend turn out to be accurate, he said, grain trucks will be lined up at the elevator.

Even so, the farmers will likely bring in yields of 70 percent to 80 percent of normal.

Mick said farmers who haven’t locked in prices for their wheat are gambling and could be hurt if prices stagnate or drop this winter.

Last year, Australia suffered a drought that decimated its wheat crop. The resulting shortage was a driver of the price surge. That scenario is not taking shape this year, Mick said.

“I’d be watching things pretty close,” he said.

Next year could be critical. If Washington farmers are not able to cash in this year and depleted wheat stockpiles are refilled, prices may be suppressed.

Said Mick: “It been a tough year, and … we’re not done yet.”

Contact John Stucke at johnst@spokesman.com, or (509) 459-5419.


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