USDA’s 10-year wheat projections

The USDA released the 10-year (2025/26 through 2034/35 marketing years) baseline projections for wheat. At first glance, the projected baseline numbers don’t appear to be very useful. However, when used with historical data, the baseline data is quite valuable (USDA ERS Agricultural Baseline Database; Nov. 7, 2024, Early-Release). 

A benchmark that is not included in USDA’s baseline is 2025 wheat harvest forward contract prices. At this writing, wheat may be forward contracted in Pond Creek, Oklahoma for $5.35; in Perryton, Texas, for $5.25, and in Weatherford, Okla., for $5.10. 

The wheat baseline data shows projected planted and harvested acres, yield, supply and demand estimates, price, variable costs, and net returns for each year 2024/25 through 2034/25. 2023/24 wheat marketing-year numbers are also included. 

For planning purposes, USDA’s projections need to be adjusted to local estimates. For example, USDA’s 10-year U.S. wheat yield projections range from 50.1 to 53.6 bushels with a 51.8 bushels per acre average. Additional information that increases the value of these projections includes the historical (2015 through 2024) average U.S. wheat yield (48.2 bushels) and the average U.S. hard red winter (HRW) wheat yield (41.7 bushels). 

The 2015 through 2024 average Oklahoma HRW wheat yield was 34 bushels, and the Texas average was 32.2 bushels per acre. The U.S. average yield was 14.2 (48.2 – 34) bushels per acre above Oklahoma yields and 16 (48.2 – 32.2) bushels per acre above Texas yields.  

Another adjustment that adds value is to calculate the potential range of yields. During 2015 through 2024, Oklahoma’s wheat yields ranged from 26 bushels (2015) to 40 bushels (2019 and 2020). Texas’ yield range was 29 bushels (2017) to 37 bushels per acre (2021 and 2023).  

What this data shows is that between now and 2034, Oklahoma wheat yields are projected to average 37.6 bushels per acre (51.8 – 14.2) with a yield range from 29.6 to 43.6 bushels per acre. Texas’ 2025 through 2034 wheat yields are projected to average 35.8 bushels per acre with a range from 32.6 to 40.6 bushels per acre. 

The U.S. wheat price for the 2024/25 through 2034/35 marketing years was projected to average $5.94 with a price range between $5.70 and $6. It’s a “lead pipe cinch” that wheat prices, during the next 10 years, will vary more than $0.30 a bushel. 

During the last 10 years, U.S. average annual wheat prices have averaged $5.80, and the range has been between $3.89 (2016/17) and $8.83 (2022/23). Oklahoma’s 10-year average annual wheat price was $5.78 with a range between $3.44 (2016/17) and $8.92 (2022/23). Texas’ prices averaged $5.85 with a range between $3.54 and $9.15. Oklahoma and Texas wheat prices average about the same as U.S. wheat prices. 

The baseline projections project average per acre variable cost to be $160 per acre and the cost range was from $155 to $164. Per acre variable production cost estimates (no land charge) for 2024, Texas and Oklahoma wheat was about $220 per acre (Texas A&M AgriLife and Oklahoma Cooperative Extension Service).  

The USDA projects wheat production costs to average slightly below 2024 wheat production costs. A review of production costs for the last 10 years shows that per acre costs will vary more than USDA’s estimate. 

What we know with certainty is that USDA’s 10-year projections are wrong. During the next 10 years, wheat production, costs, prices and net returns will be significantly above and below USDA’s estimates. 

Farmers should remember that they sell commodities (wheat, corn, sorghum, cotton, etc.). Farmers market land, labor, capital, and management. Farmers should produce the commodity that has the highest probability of producing a profit. Baseline numbers provide a starting point to compare the potential net returns for competing commodities. 

Tags: prices, wheat, projections, yield, estimates, supply and demand, harvest, USDA, price