Rains that raised record crops are sinking Kansas farmers

Kansas farmers may hit record harvests with three different crops this year, according to U.S. Department of Agriculture, and that may not be a good thing for farmers.

Timely and plentiful rains in the late spring and summer created a bin-busting wheat harvest in June, and an expected bounty of corn and soybeans starting in a few weeks.

The USDA is forecasting that state’s corn harvest will be 660 million bushels, up 14 percent from last year, on yield of 145 bushels per acre. It projects the soybean harvest at 164 million bushels with a yield of 40 bushels per acre.

And the state’s wheat harvest, already completed, is forecast at 462 million bushels, up 43 percent from last year, with yield estimated at 57 bushels per acre. That’s a little higher than the previous estimate of a month ago.

The impact of all that grain may not be a positive one for Kansas farmers because the USDA projects records for the rest of the country, as well. That much grain would tend to drive the already low prices further down.

At this point, the grain markets don’t quite believe the USDA’s forecast for record harvests because corn and wheat prices rose a few cents a bushel Friday, while soybeans fell a few cents per bushel.

Darin Newsom, an analyst with DTN Progressive Farmer, said if the USDA forecast is accurate, it will make farmers’ lives more difficult. It’s hard to know whether they should sell now, wait a few weeks until the size of the harvest becomes apparent, or wait for months in hopes that something in the global market drives prices up.

Until farmers sell, the grain will pile up in vast mounds at local grain elevators across the country.

Farmers have suffered with low grain prices for about two years. Their profits are way down and some will see losses this year.

“Farmers are dangling at end the noose with their toes just holding them up,” Newsom said. “Do you tell them to wait, the noose is going to come loose on its own?

“I know they don’t want to sell, but I understand that they may have to. And, if the yield proves accurate, it could easily send prices lower.”

This story was originally published August 12, 2016 at 5:41 PM with the headline "Rains that raised record crops are sinking Kansas farmers."