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Declining U.S. Wheat Acres at a 100-Year Low Create Challenges and Opportunities | KRVN Radio

Declining U.S. Wheat Acres at a 100-Year Low Create Challenges and Opportunities

Declining U.S. Wheat Acres at a 100-Year Low Create Challenges and Opportunities

St. Louis, Mo. (July 5, 2017) – U.S. wheat acres have declined almost yearly over the last 35 years, and in the current season, they have hit the lowest point in more than 100 years. In a new report from the RaboResearch Food & Agribusiness group, Grains and Oilseeds Analyst, Stephen Nicholson takes a look at the declining wheat acreage and the potential effects over the next few growing seasons.

The report, “Wh(e)at’s Going On?,” finds the decreased number of acres being planted may begin causing a domino effect down the supply chain. Fewer acres leads to less supply, which leads to increased imports that raise the price of the raw goods. The result is, in the end, a more expensive consumer good.

“The largest actual percentage decline in U.S. wheat acres has been in winter wheat acres, primarily hard red winter,” explains RaboResearch Food & Agribusiness, Grains and Oilseeds Analyst Stephen Nicholson. “This is of particular concern to the baking industry, as most bread flours are milled from hard red winter wheat.”

The contraction of the wheat  acres intensifies the impact of unexpected yield shortfall.  Due to the lower number of HRW acres and a higher probability of production and/or quality issues, both hard red wheat prices and spreads between U.S. wheat classes are likely to be wider and more volatile in the future.

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