Grain Growers looking to the future:
BURLEY — U.S. grain growers are just a drought or two away from higher prices.
At least as long as those dry conditions impact somewhere other than Idaho.
Three consecutive years of record world grain stocks are acting as a huge anchor to prices Idaho growers receive for their barley, wheat and corn. Throw in a strong dollar that is holding down export sales and the result is a grain futures market that can best be described as “very bearish.”
Wheat has the most bearish outlook of the three grains with a 50 percent supply-to-use ratio. U.S. barley isn’t much better at 44 percent. Corn is at just 16 percent, but that’s the largest ratio in two decades. In comparison, the world stocks-to-use ratio of 16 percent for barley and 34 percent for wheat.
“The U.S. is carrying the lion’s share of stocks,” Kelly Olson, Idaho Barley Association administrator, told producers, bankers and University of Idaho personnel attending the University of Idaho Ag Outlook Conference. “We need fewer acres or weather problems.”
Wheat and corn prices hit highs in early June, thanks to weather premiums, but have fallen 28 to 33 percent since then and aren’t expected to recover anytime soon. According to the U.S. Department of Agriculture’s latest price outlook, national barley prices will average $4.55 to $5.15 per bushel in the coming year, down 12 percent from a year ago. Corn is off about the same, down 9 percent to $3 to $3.60 per bushel.
Idaho wheat prices are expected to range from $4 to $3.477 per bushel, down 15 to 20 percent. Malt barley could fall to around $3.90 a bushel with feed barley falling to $2.40.