MISSISSIPPI STATE -- Wheat prices are reaching the highest levels in 10 years. Unfortunately, a small 1995 harvest means few growers will enjoy the financial fruits of their labor.

DeWitt Caillavet, extension agricultural economist at Mississippi State University, said wheat prices have been in the high $4 range in recent weeks. September futures reached life-of- contract highs on July 17 of more than $4.60 per bushel on the Chicago Board of Trade. At some of the smaller exchanges (Kansas City and Minneapolis), wheat traded over the $5 per bushel level.

"These are the highest prices we've seen for September wheat in 10 years," Caillavet said. "A small world crop and high demand are causing these prices."

Caillavet said the small rice crop worldwide also is contributing to the increased demand for wheat. Stock levels of wheat are decreasing rapidly due to the reduced acreage and yields in the 1995 crop.

The MSU-based economist added that consumption will outpace supply by about 7 million metric tons this year.

"U.S. harvested acreage was down about 1 million acres from 1994 to 1995," Caillavet said. "The yield on those 69.4 million harvested acres also was down almost 2 bushels per acre from the previous year."

Midwest weather has an impact on wheat prices, even though the crop is harvested.

"Weather problems in the Midwest are pushing all grain prices higher," Caillavet said. "Price fluctuations are common as speculators jump in and out of the market activity. We can expect to see unseasonably high wheat prices to continue."

While Mississippi's total acreage was up slightly in 1995, yields were down. Caillavet said a few poor wheat crop years in the early '90s have caused growers to trend toward fewer wheat acres.

John Coccaro, Sharkey County agent, said wheat plantings were down considerably. Several factors contributed to the reduced plantings last fall.

Since the best soil for wheat is traditionally planted in cotton, and last year's cotton harvest was delayed, any wheat would have been planted later than growers would like.

"A choice to plant wheat would have been a choice to plant soybeans after harvest rather than cotton in the spring," Coccaro said. "Most growers believed cotton would be the better investment in 1995."

Coccaro said the about half of the wheat planted was later considered "failed acreage" because of bad weather conditions.

"Some growers planted two or three times and still didn't harvest a good crop," Coccaro said. "Others were able to achieve normal to slightly below normal yields."