Lower Prices Mean Cuts For Grain Commission Budget

May 24, 2016

Low wheat prices have prompted the Washington Grain Commission to reduce its annual budget by more than half a million dollars.

Commissioners on May 19 approved a $5.28 million budget for the fiscal year that starts in July. That’s down roughly 10.1 percent from the current year’s $5.87 million budget.

“The commission is trying to maintain quite a bit of the budget, but realizing there needed to be trimming and cutting to accommodate the fact that income is down,” said Glen Squires, the commission’s CEO. “Last year’s production was substantially low.”

The cuts come even though this year’s wheat crop is expected to fare better than last year’s, when it was 111.5 million bushels.

This year, USDA estimates the state’s wheat crop will total 126.6 million bushels. Squires said it will likely be even higher, since crop conditions seem to be better and spring wheat yield estimates are still to be determined.

The average winter wheat yield last year was 56 bushels per acre, and this year is predicted to be 64 bushels per acre, he said.

“Even though our production is up, that price or income is going to be down next year as well,” Squires said.

As of Friday, soft white wheat, the main variety of wheat grown in Washington, was bringing $5.28 a bushel at Portland.

The commission expects to receive $3.9 million in assessments during the upcoming year, and will draw $1.3 million from reserves, Squires said.

That still leaves more than $5 million in reserves. Of that, $5 million is in restricted reserves in case of a total crop failure.

The commission assesses three-fourths of 1 percent of the net receipts at the first point of sale for wheat and 1 percent of the net receipts at the first point of sale for barley.

Virtually all budget categories saw cuts save for education, which remained about the same, Squires said. The research budget had been growing “substantially” in recent years, but was reduced from $2.1 million this year to $1.6 million in the upcoming year.

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