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ag-?
Veteran Contributor

Re: wheat hit bottom ?

We have had minus .75 basis but we also have 7 cent  a fifth discount for wheat under 14 protein and early harvested wheat in SE North Dakota has been coming in 11 protein levels so this would make wheat about $4.40 range. If this doesn't change soon loses are going to be large and money made in last couple years will bel lost in this year and next year. I don't see costs adjusting fast enough and large enough to put us back into a breakeven scenario very soon. Also very little alternatives with these prices because expansion will not be profiable enough because growing costs and land costs will exceed revenue generated to grow a crop. This going to put real economic hardship to agriculture in the next year. I am willing to bet we won't see much reduction in food prices and and never at same level we have seen in commodity prices of 30 to 45% reductions in past year. New farm bill price revenue gurantee won't cover the losses and like here protein discount is not even figured into price level when based off futures.  Like saying cheap prices should solve large inventories but how quickly this is done is yet to be determined. 

sw363535
Honored Advisor

Re: wheat hit bottom ?

Totally agree,  the inflation of costs over the last 5 years is a bigger issue than the price..or at least as big.  Making it a double problem.

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elcheapo
Veteran Advisor

Re: wheat hit bottom ?

No rain here again, went to the north
and south

AG what kind of wheat is it? With talk of
Protein, makes me believe Durham.

If so, and if my guess is from nd or SD, there
Was a "farmers coop" that got into the
Pasta business. I think they made the dreamfield pasta that was supposed to be
Good for diabetics..they kind of got kind
Of trouble over that

Sw you may know. 10 yrs ago or better
There was a bunch wanting wheat producers
to buy a share plus grow white wheat, they
Had a mill in new Mexico (?) And they were
Going to make wraps for Mexican food.
Did they go belly up or a multi million dollar co?
.

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sw363535
Honored Advisor

Re: wheat hit bottom ?

Elcheapo,

 

I cannot tell you the details, I raised WW for years and segrigated it waiting for that market to appear in a size that was feasable and about the time they were trying to gather $$ to build a mill, or buy a mill,  I give up.

KSU did great research and development,  I liked the varieties and production,  In theory it was a good product.   But even with KSU's great connections to the milling industry they never came on board with demand.

One of those examples that disproves the movie statement "If you build it they will come".

 

I am not sure how the dollars and sense issues came out in the organization.  Risk is my issue and I never contracted with the organization so I would always have a secondary market.  And couldn't see investing in an unproven market.  I can't even get Mike to recognize the wheat markets that do exist.

 

Some one who reads might be able to fill in the details of the promotional organization , I don't remember dollar details, I am sure I read them at the time.

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elcheapo
Veteran Advisor

Re: wheat hit bottom ?

Sw. Look at farmers direct foods .
You might find it interesting. If they
Still are around since 1988 they should
Be "stable"

Might be interesting to see if they could
Add some value..

BUT we've got to get it to grow first!
sw363535
Honored Advisor

Re: wheat hit bottom ?

I am kind of pro wheat right now, not because I can raise it or make a profit, but because it might be our least loss crop for marginal water acres.  Low input with profit potential ----- hopefully that is not a illusion.

 

I am totally agreeing withyou though.  We can't seem to raise a crop, the market doesn't seem to care if we raise one or not,  Four years of loses has nearly taken insurance out of the picture, chemical fallow is less and less effective.....----------------- That is a lot to ignore.

 

northnd,  Wheat just stinks right now ------ but we got some cheap seed that's something the corn belt can't say.

 

Hang in there.  You'll know you have hit bottom when Mike stops quoting your price.  Smiley Happy

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