US farmers are likely to boost wheat and soybean crops in 2008 in response to critically high prices, potentially displacing others such as corn and cotton, analysts said this week. "Even with corn prices higher ... we do believe that farmers are going to increase their planting for winter wheat," said Bill Nelson, an analyst at the investment firm AG Edwards.
With bad weather damaging harvests in several countries, wheat prices have nearly doubled since January, hitting a record nine dollars per bushel for December delivery on the Chicago futures market this week, while soybeans reached 10 dollars for delivery in November. The price of corn (maize) has only risen by 4.5 percent since the start of the year.
Soybeans and wheat are still being harvested in the United States but farmers are already planning what to plant next season. "The farmers are seeing very high prices for wheat right now but they cannot sell next year's crop at that price," Nelson said. Even though year's grain futures prices lower than the current highs, he said, "I'm sure that farmers are seeing indications that prices for harvest next year are much higher than they ever seen before."
Corn has had an excellent year, buoyed by demand for ethanol, a clean plant-based fuel made from the crop. More than 90 million acres (36 million hectares) of it was grown, compared to 60 million acres of wheat. Now analysts predict wheat planting to increase in turn.