High prices mock frustrated wheat farmers

By Carey Gillam

WELLINGTON, Kansas (Reuters) - The dewy mist over the wheat fields of Wellington, Kansas, was nearly burned off by 10 a.m. on Tuesday.

But instead of rolling out their combines and grain trucks, area farmers and harvesters in the heart of U.S. wheat country gathered around a coffee pot at a local grain co-op elevator, lamenting what could have been.

A combination of bad weather, plant disease and insect problems has decimated thousands of acres of winter wheat across the U.S. Plains that earlier this year had the makings of a bin-busting crop.

Kansas, which grows more of the No. 1 food grain than any other U.S. farm state, took the brunt of it.

"My wheat looked as good as it ever had this spring, but now this is about the worst I've seen," said 69-year-old farmer Dale Church, his eyes shaded by a worn cowboy hat.

A computer terminal in the corner of the co-op showed wheat prices at their highest levels in more than a decade after wheat futures at the Kansas City Board of Trade topped $6 a bushel last week. But that did little to brighten the mood.

"I don't care if it hits $20 a bushel. It doesn't matter if you don't have any wheat to sell," said farmer Arlis Day.

ANIMAL FEED ONLY

In Wellington, the self-proclaimed "Wheat Capital of the World," harvest of the new hard red winter wheat crop -- the chief type used for making bread -- started in earnest this week after persistent wet weather slowed progress throughout the state.

Partly because of that wet weather, the grain that is coming in is so low in quality that much of it is good only for animal feed, meaning significant discounts in prices paid to farmers, supply shortages for flour millers, and higher prices for food companies and consumers.

Some Kansas fields that typically might yield 40-50 bushels per acre this year are producing between 20-25 bushels per acre or less. Kansas Agricultural Statistics Service reported Monday that 37 percent of the wheat crop was in "poor" to "very poor" condition with 29 percent rated in fair condition, and 25 percent considered "good." A mere 9 percent rated "excellent."

The crop initially was well-positioned, with near-ideal growing conditions through March. But early April brought a sudden plunge to frigid temperatures. That was followed by excessive rains and troubles that ranged from hungry worms to damaging disease.

Ken Fitzpatrick, who manages the 450-member Farmers Co-op Grain Association in Wellington, said he expects no more than 1.5 million bushels to come into the co-op elevator this year, down from 4 million in a typical year.

PRICES SOAR

According to predictions by the U.S. Department of Agriculture, U.S. growers overall will reap 2.168 billion bushels, or 59 million tonnes, of wheat this year, including 1.61 billion bushels of winter wheat such as that grown in Kansas. The USDA dropped its forecast for winter wheat production by 6 million bushels from a forecast offered in May.