July 20, 2006

Wheat farmers hurting from strong Canadian dollar

The rising Canadian dollar has reduced farmers' incomes by about a third, a Ministry of Agriculture cereals specialist, Peter Johnson said.

Although wheat is trading on US exchanges at near-record levels, the Canadian dollar's climb to just under 90 cents.

Thus although prices are good on the CBOT, it is another matter at the farm gate, Johnson said.

Soft red winter wheat-- which makes up about 75 percent of Ontario's total wheat production, is going for about US$3.15 a bushel, he said.

That is below the US$4 or higher break-even point most wheat farmers face, Johnson said.

Wheat yields have ranged from 55 to 130 bushels per acre on Southwestern Ontario farms this summer, he said.

Farmers are expecting good wheat and corn harvests with above-average yield potential

Corn, which is selling for about US$2.52 a bushel, had "phenomenal growth" over the last week, climbing more than 45 centimetres in the favourable growing conditions, farmers said.