"It's going to look like Kansas out there next summer." That's what a local farmer said last week over his morning coffee. "Wall-to-wall wheat and looking like a lawn of new grass over the winter," he said. This is an exaggeration of course, but the normal wheat acreage of 4-5000 acres in the Skagit Valley has doubled to 8-10,000 acres.
Record high wheat prices in the global market explain that, according to Mike Shelby, executive director of the Western Washington Agricultural Association in Mount Vernon.
The market for wheat is complicated and volatile. The price has doubled from a range of $4 a bushel to $8 a bushel, and Skagit Valley farmers have been fast on their feet about this.
They plant wheat in October, and passersby can see young green shoots in various fields at this time. Air temperatures are low now, but the soil is still warm from summer heart. The young wheat plants will get established and send down good root structure in November, and then go dormant in December.
Huge flocks of snow geese feed on the wheat shoots over the winter, sometimes causing crop damage, but this year they will have twice the acreage to choose from, so that's good for the geese and also good for the farmers.
Wheat is not a big money maker here. Farmers plant it as a cover crop, or as part of their crop rotation. For instance, red potatoes need a 4-year rotation, and seed crops need up to 8 years before they can be re-planted in the same field, so wheat and peas and corn for silage fill in during the off years.
Farmers, in most years, will decided in the spring whether to plow under the wheat crop, or leave it to be harvested in late summer. This year they are more than likely to keep their wheat crop in the ground because of the high price.
Commodity prices, from oil to corn to soy beans, have been surging upward. Ethanol production in the Corn Belt has led to record corn prices, and wheat prices follow corn prices. A serious drought and crop failure in Australia has lowered the global supply of wheat. Economic growth in China has increased demand, and crop land in China has been reduced to make room for that growth. Throw in oil at close to $100 a barrel, and all the basic prices start moving upward.
When farmers plant as much corn and wheat as possible, less land is available for vegetable crops, and those prices rise too.
In the Skagit Valley, an extra 5,000 acres of wheat, means 5,000 acres less of some other crop, and that will most likely be peas.
Peas used to be the cash king of local crops, but their place has been taken by potatoes, seed crops and berries. Most farmers say peas are only a break-even crop, but it's a legume that helps to fix nitrogen to the soil and worthwhile planting for that reason.
But pea acreage should be way down next year unless buyers can offer a higher price. That means Twin City Foods in Stanwood, the only pea processor left in the area, will be under competitive pressure to offer more to farmers. They can only do this if they can pass on the cost and sell their peas at a higher wholesale price. Then consumeres will end up paying more at the grocery store.
It's all tied together, all around the world. Wheat and corn are fed to cattle, chickens and hogs, so meat prices will rise. Record grain prices mean increased soy bean planting in Brazil because soy bean land is less available in the U.S. Increased soy bean planting in Brazil means more destruction of the Amazon rain forest.
Record grain prices also mean money is transferred from urban areas, where most consumers live, to rural areas where the producers live.
It means every farmer in Iowa is buying a new pickup this year. If you're a seller, you're happy, but if you're a buyer, you're hurting.
Locally, higher crop prices ensure the preservation of farmland, because when farmers make money they are less inclined to sell land for urban development.
And one last point. It can all change in a flash and it's a calculated gamble for the farmer. Everyone knows what the price of wheat is today. No one knows what the price will be in August when the wheat is harvested.
Oh, they are also having a serious drought in Georgia where most of the nation's peanuts are grown, so the price of peanut butter will go up too.