LAKIN, Kan. (KSNW) — After fears there wouldn’t be any wheat crop this year, farmers are dealing with a harvest that’s actually costing them more to store their grain.
There’s so much that it’s actually cutting into their already small profits.
Record harvests have driven down the price of grain. It’s simple supply and demand. With farmers trying to hold on to as much grain as they can until the market changes, grain elevators still need to stay in business.
They’ve increased their cut of a bushel. Their share, or the basis, has hit record highs
“It’s going to be tight for a while,” said farmer Gary Millershaski, “and it’s really sad. You’re going to see some farmers that aren’t going to be able to do it anymore.”
Last year the price for a bushel of wheat was about $6, and the basis, the grain elevator’s cut, was about 60 cents.
That was about a tenth of a farmers’ earnings on a bushel.
Now the price is $4.19, and local elevators are taking up to $1.40 per bushel
“That’s 30 percent,” said Millershaski. “And it bothers you when you have a 60 pound bushel and it feels like we’re only getting paid on 40 pounds of it. We’re losing a third of it, is what it boils down to.”
Farmers like Gary say it’s an up and down process. He guesses the market will turn in favor of sellers in about 3 or 4 years.
Until then, he and others are selling their crops at a loss, just to pay the bills.
“The economy in rural areas,” said Millershaski, “it’s a trickle down from what the farmers do. If the farmers are having bad times, you’ll see everybody in town having bad times.”
Farmers say they’ve lost about $20 in profits per acre this year because the record harvest has driven down the price of grain.
The upcoming harvest is also expected to see record yields.