Wheat prices fell to a two-month low this week, with the benchmark Kansas City wheat contract falling to $4.72 per bushel on Friday.
Prices are under attack due to foreign competition, which is hurting U.S. farmers’ ability to sell their grain abroad. Normally, a third of American wheat is sold to foreign buyers, but exports have been slow this year, bottling up grain. Our biggest competition comes from Russia, Ukraine, and other Former Soviet Union nations; their wheat has been consistently cheaper than U.S. wheat, forcing our farmers to sell at lower and lower prices.
Worse yet, the U.S. Department of Agriculture expects global wheat production to rise by nearly 5% next year, which could mean that lower prices could be baked in for a while.