Low wheat yields and prices are hurting Oklahoma farmers, but they’re hurting grain elevators even more.
Oklahoma is seeing its lowest wheat yield since 1957. And despite the short supply, prices are hovering at the five-year average — about $6.50 per bushel.
Grain elevators buy wheat and other grains from farmers for storage and later sale.
Farmers have a measure of protection during hard times, said Kim Anderson, an agricultural economics professor at Oklahoma State University. They can buy crop insurance from the government. Many do. On average, the insurance covers about 70 percent of the loss.
But grain elevators can’t get insurance. They just have to take the loss.
“They’re taking the full brunt of this short crop,” Anderson said.
Vincent Smith, manager at Farmers Cooperative Exchange, said that the past few years have been hard on his grain elevator business, but this one has been the worst.
Smith said his operation saw about 23 percent of the usual crop size.
“Maybe we’ll get some fall crops,” he said.
Products that get harvested later in the year, like corn and beans, can alleviate the damage. But nothing can fix the wheat harvest’s disappointment.
Estimates for this year’s wheat harvest put Oklahoma’s producers at 51 million bushels, Anderson said. The five-year average yield is more than 105 million bushels.