Regional Wheat Prices Lowest in 15 Years

wheat prices
Fig. 1. Soft white winter wheat prices at Portland, OR, expressed in 2017 dollars ($/bu)

Prices for No. 1 soft white winter wheat at the port of Portland, OR,  averaged $4.86 per bu in August through December of 2016, according to the Ag Marketing Service of the USDA. Correcting for inflation, average marketing year wheat prices in Portland have fluctuated considerably over the past 36 years. Wheat prices, adjusted for inflation, were highest in the early 1980s, falling from a high for the whole series of $11.68 per bu in 1980 and declining thoughout the 1990s. The lowest prices of the series hovered around $4 per bu in 2017 dollars in 2000 and 2001. In 2008, wheat prices spiked to $11.28 per bu (2017 dollars), then hovered around $6.80 per bu in 2014 and 2015, before falling by nearly 30% to their current levels.

These Portland prices do not reflect transportation expenses that farmers must pay to market their grain. For Bonners Ferry growers, transportation averages $1.45 per bu via truck or $1.25 per bu via rail.

In addition to low prices, growers were hit with additional penalties for falling numbers, which is a wheat quality test designed to test the presence of alpha amylase (AA) activity in the grain. Falling numbers are affected by both temperature fluctuations and precipitation patterns. Low falling numbers indicates high AA activity, which can be caused by preharvest sprouting or by temperature fluctuations during grain maturation.

With this wheat price, net returns over total costs for soft white winter wheat, a major cash crop for the entire dryland Pacific Northwest region, are estimated at -$82 per acre in a recent study (Fig 2). Soft white winter wheat crop is grown on over 40% of all acreage in the dryland crop producing region of the inland Pacific Northwest (USDA-NASS). While some of the non-grain crops were profitable, such as peas ($50 per acre) and chickpeas ($40 per acre), average returns per acre were negative for all crop rotations, with a rotation of hard red winter wheat, hard red spring wheat, and peas  being the least negative, at -$27 per acre. These results are part of a study that will be published by the University of Idaho later in 2017. Please contact the author at (208) 267-3235 for more information.

current crop returns

Fig. 2. Net returns over total costs by crop for the annual cropping region of the dryland Pacific Northwest, 2016 farmgate prices

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North Idaho Crop Budgets

These crop budgets represent estimates of typical economic returns for production of the major agricultural commodities in North Idaho. Fair market values are used to estimate returns for each factor of production. These budgets are available in interactive spreadsheet formats (Excel) and also as a printable document in pdf (portable document format) format.

2015 Cost and return estimates for hay production in North Idaho
Pdf        Excel

2015 Cost and return estimates for alfalfa production in North Idaho
Pdf       Excel

2016 Cost and return estimates for grain production in North Idaho, including wheat, barley, oats, peas, lentils, garbanzos, lentils, and yellow mustard
Pdf       Excel

2015-02-22 15.35.34