Despite the wind and rain that kept us out of the wheat field in June, we have finished harvesting our crop!
But what happens after the combine cuts the wheat? Great question 😉
The picture above show the combine unloading onto the cart. We use the tractor and cart because of those huge wheels you see. A semi drives on roads, but wheels on the tractor and cart can drive through fields much better. After the cart is full the tractor pulls it out to the road and unloads on the semi. Then the semi drives back to the grain bins and unloads the grain into the bins.
And then what?
So glad you ask! Then we sell the grain. Have you ever clipped coupons or watched for sales on your favorite foods? Have you ever purchased lots of something because it was a good price? Well, grain prices change almost EVERY day and farmers are always watching for a good price! Is it too cold in the states where wheat is growing? Prices might go up because buyers believe the wheat will not grow well. There will be less wheat and they want to be sure to get some! If they really, REALLY want that wheat they will pay more to make sure they have it.
Is it sunny, warm, and just perfect in the states where wheat is growing? Prices might go down. People believe there will be lots of wheat. Everyone will have wheat to sell and you can get wheat whenever you want it. There is no need to pay a lot.
We call this the Law of Supply and Demand. The amount of wheat we have is our “supply” of wheat. “Demand” means how many people want it. Lots of supply can mean low prices and not enough demand can do the same thing. High prices come when there is a low supply and lots of demand. American farmers help feed the world, so right now demand is pretty high. Wheat prices often depend on weather– how well did wheat grow? What is the supply?
When we can, farmers like to sell grain at high prices. But we can’t always do this. Sometimes prices stay low for long periods of time and farmers need money. They have to sell their wheat for whatever price they can to pay for seeds for next year, diesel for the tractor, or to buy groceries for their families!
Sometimes farmers make choices to sell, thinking prices are good, but then prices go up the next day, week, or month. It can be very difficult to predict the future!
Try this activity to see what its like to buy and sell grain like a farmer! This website has a simple table so you can see what corn is selling for at three hog farms. http://www.psfarms.com/missouri_corn_bids.asp Pretend you have corn to sell. Choose a time frame, such as two weeks, and check the website everyday to see what prices are. Write them down in a notebook. At some point during the two weeks pretend to sell your corn. Make sure to continue recording until your time frame has ended. Now, how did you do? Did you sell at the best price? Was it good? Bad? Did the Law of Supply and Demand affect prices? Do you think this year’s drought will make prices go up or down?
*Note: you can also try this activity using produce from your gorcery store. Take your notebook with you and jot down prices. Do they go up or down? What factors affect price?