U.S. Wheat Farmers Struggle Despite Record Harvest

Profit remains elusive for US wheat farmers, with many expecting to operate at a loss in 2024, according to a Reuters report by Heather Schlitz and Julie Ingwersen.

Despite achieving a record harvest, ample global supply has kept prices stagnant, hovering near their lowest levels in nearly four years. I Photo: USDA Economic Research Service

Despite achieving a record harvest, ample global supply has kept prices stagnant, hovering near their lowest levels in nearly four years. Meanwhile, the costs of equipment and transportation remain high, further squeezing farmers' margins.

The situation is particularly challenging for winter wheat farmers in the Great Plains, who may still incur losses despite a promising crop.

This comes after three years of drought, which significantly reduced yields and forced many farmers to abandon wheat cultivation.

US wheat prices have plummeted due to cheap supplies from the Black Sea and Europe, replenishing global stocks, while abundant corn harvests worldwide have further pressured prices across the commodity grains complex.

In Kansas, for example, farmers would need exceptionally high yields and prices to break even.

According to a Kansas State University analysis, farmers would require a yield of approximately 60 bushels per acre at a price of $6.26 per bushel, well above current cash prices and futures prices.

With winter wheat harvests scheduled for June and July, the challenging market conditions signal tough times ahead for rural America, as US farm income is expected to decline in the coming year.

Despite being the world's fifth-largest wheat exporter, the US has lost market share to top exporter Russia and other producers in recent years, exacerbating the struggles faced by American wheat farmers.