Falling wheat prices may pressure US supplies in 2009
Falling wheat prices are likely to pressure US wheat supplies next year, US wheat producers told Asian importers on a recent trip, according to a newsletter Friday (December 5) from US Wheat Associates, a lobby group for wheat producers.
"We have to buy fuel, seed, fertilizer and herbicides ahead to make sure we have enough on hand for harvest and to seed the new crop," Chris Cullan, a US wheat farmer, was quoted as saying.
He added if costs didn't come down or wheat prices didn't go up, "we are going to have to look hard at cutting back (on sowing the 2009 crop)."
US farmers told Asian importers the cost of inputs for US farmers planting the spring crop in 2009 will be much higher than 2008.
They added this has given rise to more uncertainty in the minds of US wheat farmers on what to plant next year, than at any other time in many years.
The group of US wheat producers visited importers in South Korea, Taiwan, Indonesia and Vietnam. "Next spring, I can choose to plant a number of different crops. If I can make more money on corn, soy, canola or another crop, I will not plant as much wheat. Not every farmer has that option, but I think there are a lot of wheat producers around the world that are going to face the same unfortunate decision," said another US farmer, David Clough.
The newsletter noted analysts are now talking of a much smaller US wheat crop next year, even assuming good yields.
The US is the world's biggest wheat exporter.