In the face of an expected global wheat harvest of a record 25.4 billion bushels, US farmers planted more winter wheat this past fall than they did in the fall of 2010. Farmers planted 41.9 million acres of winter wheat this year even though wheat in storage has reached a near-record of 7.5 billion bushels.
These latest reports from the US Department of Agriculture and the International Grains Council have not yet pressured prices though. Wheat prices have risen more than 12% so far this year, and stand at about $6.53/bushel currently. That’s significantly below the near-$9/bushel price of last February, but well above the low price of $5.75/bushel of the past 12 months.
Unusually high insurance payouts for failed crops get the credit — or blame — for the high fall planting rate. Farmers who bought insurance on this year’s crop are positioned to receive $8.62/bushel for the difference between what they actually produce and what the average yield on their acres normally produces.
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