November 1, 2017 / 7:01 PM / a year ago

Low prices, bad weather seen curbing U.S. Plains wheat seeding

CHICAGO, Nov 1 (Reuters) - U.S. winter wheat acreage for harvest in 2018 could shrink further from 2017’s 108-year low as poor returns deterred farmers from planting the crop this autumn and excessive rains disrupted the plans of those that did.

While the world is awash in wheat, U.S. production fell to a 15-year low in 2017 and the high-quality wheat grown in parts of the country remains vulnerable to shortages. A drought this year in key growing areas sent spring wheat futures soaring.

Gary Millershaski, who farms in west-central Kansas, is cutting the percentage of his acres devoted to wheat, even though he has added more land.

“There’s just not the money in it,” Millershaski said. “Years ago, we used to be straight 50 percent wheat,” he said, adding that wheat only makes up 38 to 40 percent of his current acreage.

Kansas is the biggest wheat producer of all the states but its winter wheat acres could fall as much as 10 percent from a year ago, said Justin Gilpin, chief executive officer of the Kansas Wheat Commission.

Oklahoma, the No. 3 winter wheat producer this year, could see a similar reduction, said Kim Anderson, an agricultural economist at Oklahoma State University.

“The one thing that would be a welcome surprise is if we had no drop. Generally the consensus is we will have some amount of lower wheat seeding,” said Dan O’Brien, a Kansas State University agricultural economist.

In central Kansas, cash prices for wheat are $3.20 to $3.40 per bushel - below the cost of production for some growers, O’Brien said, as plentiful global supplies eat into U.S. exports and keep overall prices under pressure.

Many farmers in the Plains have shifted acres to more profitable crops such as corn, soybeans and cotton, and that trend is likely to continue in 2018, the economists said.

In Kansas, farmers planted 5.5 million acres (2.2 million hectares) of corn in 2017, the most since the 1930s, and a record-high 5.15 million acres of soybeans. Wheat plantings fell to 7.6 million acres, the second lowest acreage in U.S. Department of Agriculture records dating back to 1919.

On top of the poor economics, farmers have had to contend with heavy rains that left fields too muddy to use the heavy equipment used to plant wheat and harvest corn and soy. For farmers who plant wheat directly after harvest, known as “double-cropping”, that has been a double blow.

“With corn harvest delayed, (we are) not going to see as much double-crop behind corn, Gilpin said.

Wheat planting in Kansas as of Oct. 22 was the slowest on record, according to the USDA. By Oct. 29, the crop was 84 percent planted - still behind the five-year average of 93 percent.

For Millershaski, the heavy rains pushed back planting by about three weeks, until mid-October. Then, worried the wheat would not have time to develop enough before winter, he planted about 60 to 65 pounds (27-30 kg) of seed per acre, compared with his normal rate of about 35 pounds.

“That doubled our seed costs per acre pretty quick,” he said. (Reporting by Julie Ingwersen; Editing by Jo Winterbottom and Marguerita Choy)

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