Mar 02, 2008 - 04:06:13 CST
TAYLOR - Greg Madler had to feel like he'd found a winning lottery ticket in the dirt back home.The kernels cascading from his truck sparkled like gold dust. For once, those shiny nuggets he grew in that dirt were just about as valuable.
Madler was at the Southwest Grain terminal near Taylor on Thursday, a chilly day when even winter seemed tired of itself. He was using the fussy weather to haul in wheat he'd sold on contract for more than $10 a bushel, a price his dad never once saw in all his years on the farm.
He and his brother John farm together south of New England, and they've got some wheat left in the bin. And that wheat is the real gold dust, the winning lottery ticket, and he's glad to have some still to sell.
The board in the elevator weigh-in office listed hard red spring wheat at more than $18 a bushel, a price that looked like somebody messed up the decimal point. And that was down from $20 just the day before.
The slide was viewed as temporary, and good old spring wheat was expected to rise again, like bread in the oven, back over $20 and somewhere beyond into unchartered territory.
"This is one for the books," Madler said. "I'm sure we'll never see this again."
Madler said he'll hold his remaining wheat awhile. He'll gamble that what's left will be worth twice the $10 he sold it for Thursday, already twice what he and most others sold it for this fall.
Mark Messer, of rural Richardton, pulled in behind Madler, the windshield of his truck speckled with the light cold rain falling outside.
He dumped about 1,000 bushels, most on a contract price, but some open. He can pull the "sell" trigger on those open bushels between now and May 31.
He said he and his family partners of Beaver Creek Farm would decide whether to sell at $18, or gamble that the price will go up.
"You don't see any farmers complaining," he said.
Like Madler, Messer said the unprecedented profit means they can all go to the bank and pay down loans, and give money to the equipment dealer and upgrade an old tractor, or buy another piece of machinery.
"The farmer doesn't have his money very long. He takes it to town," Messer said.
Harlan Klein is an Elgin area farmer who chairs the North Dakota Wheat Commission and is on Southwest Grain's board of directors.
Klein says only 10 percent to 15 percent of the '07 wheat crop remains to be sold, translating into relatively few producers who can capitalize on today's price.
On the other hand, he said he doesn't think strong wheat prices will end anytime soon.
He's more at home with a tool box than tarot cards, but his wording gets a little mystical when he looks ahead for agriculture.
"The stars are lined up to where we should maintain a decent price," he said.
He said he thinks wheat growers can count on $11 or more a bushel for "new crop," meaning wheat off the field come July and August.
And that's only if nothing happens anywhere in the world to affect the global wheat supply. There's no risk on the downside, he figures.
"Supply" is a word every high school student learns is paired with "demand," to establish the value of commodities and goods.
Growing demand for wheat in countries like China and India is one star in alignment. A low worldwide wheat supply is another.
The weak U.S. dollar is a third star - not one typically welcome - but it does give the Euro and other currencies more punch against the high price of exported American wheat.
That spit of rain Thursday and the calendar leafing toward spring mean it'll be only six weeks, eight at most, and seed drills will be injecting wheat into millions of North Dakota's furrowed acres.
Bob Wisness of McKenzie County is a farmer and director of North Dakota Grain Growers Association. He said current prices are a "savior" for some growers. There are a lot of high expectations for this year, but he said it's too early to count the cows and chickens. They won't come home to roost without rain.
"It all hinges on growing conditions," Wisness said. "It's extremely dry out there."
Byron Richard is chairman of the grain growers and a rural Belfield farmer. He thinks producers will sell every bushel they've got left into what could be an once-in-a-lifetime market, rather than carry any over.
He said people should remember that most farmers sold most of their grain in the months right after harvest at an average of $5 to $6 a bushel, a price that looked real good at the time.
"This past year has been the most frustrating ever," he said. "I'll guarantee that there are farmers who left $1 million on the table in the biggest run up in the wheat market history."
He said he thinks '08 will be the true windfall year, with new crop contracts between $10 and $12.
He predicts North Dakota wheat acres will increase, but not hugely so, since other commodities also are strong.
He also predicts farmers will prefer making multiple price contracts spread out over the fall and winter, rather than lock in early, like they did this year.
Madler said he and his brother have made a practice of multiple, smaller contracts, a practice that served them well this year.
Even though he and his brother have some grain left, he said it is hard - for him and other wheat growers - to watch this wild market run and not think of it as money lost.
"It's not 'lost,'" he said. "We never had it."
There is - maybe - always next year.
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