The U.S. winter wheat crop is expected to be down 9 percent from last year
at 1.71 billion bushels according to the US Department of Agriculture. Meanwhile,
the corn crop is expected to be around 9.64 billion bushels, which would make
it the second-biggest year on record, and soybean is expected to be up 3 percent
to a record 2.8 billion bushels.
So if corn and soybean are so plentiful, what’s the deal with wheat? Is
environmental degradation finally getting the best of the American farmer? Hardly.
The per bushel price of wheat is in a free fall as world markets are glutted
with wheat thanks to strong competition from the European Union. Whereas last
year the average price per bushel topped $4, this year farmers will be lucky
to get $3 per bushel. Many farmers have switched to other crops as a result.
Finally, Florida’s orange crop is also expected to reach a new record
level of 14 million tons, up 11 percent from last year.
This is all great news for consumers and people who like cheap food, but lousy
news for farmers who made enormous profits after 1996’s disappointing crops.
Already the USDA is talking about propping up the price of farm commodities
in response to the EU’s competition.
Sources:
Winter wheat crop down 9 percent from last year. Curt Anderson, Associated
Press, May 12, 1998.
Hard times predicted for US farmers. Charles Abbott, Reuters News Service,
May 12, 1998.