Arkansas winter wheat crop hit by flooding

CHICAGO (Reuters) - Flooding from heavy storms last week has submerged tens of thousands of acres of winter wheat in Arkansas, a university agronomist said Tuesday.

"We've got tens of thousands of acres of wheat that has gone under water," said Jason Kelley, extension wheat agronomist with the University of Arkansas.

The flooding along the Arkansas River and its tributaries will likely lower yields in some fields and may kill the crop in other areas, depending on how long the water lingers.

Wheat should recover in areas where standing water lasts only two or three days, Kelley said, but with some rivers still rising, low-lying areas could be submerged for two weeks.

"There are a lot of fields that have been under water for five or six days, and the water is just not dropping very fast," he said.

Farmers whose wheat is damaged may switch to spring-seeded crops including corn, soybeans, rice or cotton.

Arkansas growers planted 870,000 acres of winter wheat for harvest in 2008, up 6 percent on the year. The state grows soft red winter wheat, which is planted in the fall and harvested in the spring after a dormant period in the winter.

U.S. seedings of soft red winter wheat for 2008 rose 21 percent from a year ago, reaching 10.5 million acres, as farmers took advantage of historically high prices at planting time last fall.

That jump in acreage muted the market impact of the recent flooding and potential acreage loss in Arkansas and the southern Midwest from Missouri to the Ohio River Valley.

"It's an underlying concern. But with us up over 10 million acres -- it provides a little psychological support, but not much in terms of changing the balance sheet," said Shawn McCambridge, an analyst with Prudential Financial.

May wheat futures on the Chicago Board of Trade closed Tuesday at $10.67-1/2 per bushel, up 47-1/2 cents, rebounding from a sharp sell-off last week as commodity funds resumed buying wheat, corn and soybeans.

A year ago, CBOT wheat was trading around $4.60 a bushel.

CBOT wheat futures rose 77 percent in 2007 and the May contract hit $13.49-1/2 last month, a CBOT record, buoyed by historically tight U.S. and global wheat supplies and an influx of speculative capital in the grain markets.

Soft red wheat production totaled 358 million bushels in 2007, representing about 17 percent of the overall U.S. wheat crop of roughly 2 billion bushels. Soft red wheat is used in flour for cakes, crackers and flatbreads.

(Editing by Christian Wiessner)