Friday, August 6, 2010
A price spike in wheat is happening because of problems half way around the world, and Kansas farmers are benefiting.
A drought in Russia is causing numerous wildfires there and severely hurting that country's wheat crop. But the problems in Russia are sending wheat and other grain prices here up.
Kansas farmer Bob Robben knows farmers have to have a strong stomach to react to recent grain price swings. The Russian drought and resulting wildfires sparked rallies in grain trading around the world, and now in Kansas.
The trickling down of Russian events and the cash prices Kansas farmers get at local grain elevators became apparent. Take the Andale Coop in Colwich for example. Friday's cash price for wheat is $6.30 a bushel. Back on June 22nd at harvest time the cash price was $3.67 a bushel. That's a nearly $3 difference.
But most Kansas farmers, some estimate 75% of them, have already sold their wheat. So, not all can cash in on the price surge. But they can take advantage of the domino effect of the wheat rally. That price spike is now spilling over into the corn, milo and soybean markets and helping to raise those prices.