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Winter Wheat Crop Estimated at 11-Year Low Because of Drought

June 13, 1989

WASHINGTON (AP) _ A further decline in this year’s wheat prospects is prompting renewed calls for federal drought aid to hard-hit farming areas that have not yet recovered from the 1988 burn-out.

The Agriculture Department says farmers are harvesting a winter wheat crop estimated at an 11-year low of 1.41 billion bushels, down 10 percent from last year’s harvest and 2 percent below the May forecast.

Based on June 1 surveys, the latest estimate announced Monday compares with last month’s forecast of 1.43 billion bushels and the 1988 winter wheat harvest of 1.56 billion bushels.

The next estimate will be July 12.

Officials said the average yield, based on June 1 conditions, was estimated at 34.5 bushels per acre, compared with 34.9 bushels per acre estimated in May and last year’s per acre average of 39.2 bushels.

Farmers are expected to have about 40.8 million acres for harvest this year, up 3 percent from 39.8 million acres in 1988, the department’s Agricultural Statistics Board said in its report.

″Once again, we see evidence of a significant shortfall in the wheat crop on an expanded area,″ said Carl Schwensen, executive vice president of the National Association of Wheat Growers. ″The outlook is not likely to improve from this point onward.″

Winter wheat, planted in the fall and harvested the next summer, makes up about three-fourths of total U.S. wheat production. The remainder is planted in the spring.

Next month’s crop report will include production estimates for spring- planted wheat, thus providing the first 1989 look at total U.S. wheat output.

The first estimates of 1989 output of corn, soybeans, cotton and other major crops will be issued Aug. 10.

Lingering drought and late-season freezes crippled much of the winter wheat crop in parts of the Great Plains, notably in Kansas where this year’s harvest was estimated at 202.4 million bushels. That was unchanged from May indications, but far below last year’s harvest of 323 million bushels.

The continuing effects of drought in Kansas and some other states have stirred demands for federal aid comparable to the $3.9 billion emergency measure passed by Congress last year to help cover 1988 losses.

Legislation has been introduced to expand 1989 drought assistance, but the administration has opposed any massive rapid-fire remedies until more is known about the crop situation.

Schwensen said the June winter wheat report ″highlights once again the need for federal disaster legislation.″

The skimpy wheat outlook is not expected to have a major impact on the price of bread or other food products, according to USDA economists.

Overall, they expect consumer food prices to increase an average of 5 percent to 7 percent in 1989, compared with last year’s average gain of 4.1 percent. Higher vegetable prices stemming from severe winter cold and lingering effects of last year’s drought are major factors.

In a related supply-and-demand report, USDA projected total 1989 wheat production - a figure based on assumptions of normal weather and trend yields - at about 2.03 billion bushels, up from last year’s 1.81 billion bushels. That was down slightly from the May projection.

The report showed that wheat prices could rise to an average of $3.80 per bushel to $4.20 per bushel in 1989-90, from $3.74 per bushel in the wheat marketing year that ended May 31.

With higher prices ahead, wheat exports could decline to 1.15 billion bushels, from 1.44 billion bushels in 1988-89, the report said. The U.S. wheat stockpile June 1, 1990, would be down to about 500 million bushels from 616 million bushels on hand this June 1.

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WASHINGTON (AP) - Farmers have contracted with the government to take an additional 2.46 million acres of highly erodible cropland from production under the 10-year Conservation Reserve Program.

The additional acres were enrolled during the program’s eighth round of signups held Feb. 6-24, the Agriculture Department said Monday. The next will be July 17 through Aug. 4.

Keith Bjerke, administrator of the department’s Agricultural Stabilization and Conservation Service, said the total contracted under the CRP is nearly 30.6 million acres.

Bjerke said the total now exceeds the 28.7 million acres that was in the 1960 Soil Bank program, making the CRP ″the largest long-term cropland retirement program in U.S. history.″

Under the program, farmers agree to take their land from production for 10 years. In return, based on bids they submit, farmers who are accepted get annual rental payments from the government and one-time assistance to pay for half the cost of planting trees, shrubs and grass to guard against erosion.

Average annual rental payments have been running close to $50 per acre.

The goal set by Congress in the 1985 farm law is to have 40 million to 45 million acres in the program by 1990.

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WASHINGTON (AP) - The Agriculture Department says the outlook continues favorable for a bumper grain harvest in the Soviet Union this year.

Total grain production was estimated at 210 million metric tons, unchanged from the previous forecast, the department’s Foreign Agricultural Service said Monday in a monthly report.

Production at 210 million tons, up from 195.1 million tons last year, would include 91.5 million tons of wheat, 105.5 million tons of coarse grains such as corn and barley, and 13 million tons of miscellaneous grains.

Soviet grain imports were projected at 33 million tons for the trade year that will begin on July 1, unchanged from the earlier forecast.

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