In 2016, wheat farmers have seen ugly circumstances, now they’re trying to help the problem by reducing acreage.
Craig VanDyke of Top Third Ag told U.S. Farm Report host Tyne Morgan rumors of drought aren’t as concerning to him as the acreage story.
“We need to drastically reduce acreage in order to find ourselves competitive globally price-wise,” said VanDyke.
Soybean prices could be a motivation to reduce wheat acres and move them to soybeans. VanDyke has talked to producers who are growing soybeans in Montana for the first time.
“If you’re going to find a rally in wheat prices, you need to focus on the spreads, and spreads start to give signs of maybe this market can start moving out,” said VanDyke.
Tommy Grisafi of Advance Trading, Inc. shares the same view. He cites that unlike soybeans that can be grown in the U.S. and South America, wheat can be grown all over the world, making it difficult to trade.
“It’s easier to keep track of what’s going on in corn and beans in America versus what’s going on in the rest of the world,” said Grisafi.
Listen to Grisafi and Van Dyke discuss the Dow rallying, cattle price predictions, and the effect of the Fed raising interest rates on U.S. Farm Report above.