By Heather Schlitz

(Reuters) - Profit is growing further out of reach for U.S. wheat farmers and many do not expect to break even in 2024 as ample global supply keeps prices around their lowest in nearly four years at the same time costs including equipment and transport remain high.

The current state of the U.S. wheat market will hit winter wheat farmers in the Great Plains hard. They may lose money despite having what looks to be their best crop for some time after three years of drought sapped yields and forced farmers to abandon wheat.

U.S. wheat prices have plummeted as cheap supplies from the Black Sea and Europe replenished global stocks of the staple grain, and as plentiful corn harvests worldwide pressure the entire commodity grains complex. U.S. winter wheat will be the first crop to be harvested in a year when U.S. farm income is expected to plummet, signaling tough times ahead for rural America.

Chris Tanner, a farmer in the top wheat growing state of Kansas, said he would need to harvest 10 bushels more per acre than last year in order to break even.

"It's hard to describe how that makes me feel without seeming like an angry farmer with a pitchfork," Tanner said. "It makes me feel like I'm working in vain to raise a superior product."

A Kansas State University analysis showed Kansas farmers would need a yield of roughly 60 bushels per acre at a price of $6.26 per bushel to break even, well above cash prices in the state that have ranged between $5 and $5.80 as well as July futures prices. Winter wheat is harvested in June and July in the Great Plains.

The London-based International Grains Council forecasts a record global grain crop in the 2024-2025 marketing season, reinforcing concerns about a global glut.

While the size of the U.S. winter wheat crop will become clearer in coming weeks, particularly during an annual wheat tour in May, the U.S. Department of Agriculture said on Monday that 55% of the crop is in good-to-excellent condition, the highest for this time of year since 2020.

Scott Born, a wheat farmer near Dallas, Texas, said he needs a price of at least $6 per bushel of wheat to break even, a price that is also above the current cash price in his region.

The costs to transport and produce American wheat remain high compared with Black Sea and European wheat, raising existential concerns about the long-term competitiveness of U.S. exports.

The U.S. is the world's No. 5 wheat exporter, having lost market share to top exporter Russia an other producers in recent years.

The global market is so competitive that American companies at times have bought European wheat to take advantage of low prices. The USDA estimates wheat imports in the current marketing year at 18 million bushels, the highest in a decade.

FEWER WHEAT FARMS

USDA expects farmers to reduce the number of wheat acres planted for the 2024 growing season, counting both the winter and spring crops, by more than 4% compared with 2023. The number of U.S. farms growing wheat has sunk by over 40% in the last two decades as farmers favored other crops.

While wheat prices have collapsed, farmers said costs for farm equipment, repairs and labor have soared, leaving them with little money in their pocket after harvest. Farmers said crop insurance policies will allow them to recoup only a portion of their financial losses and payouts are not enough to make them whole.

USDA expects 2024 U.S. farm income will fall by nearly $40 billion from a year earlier in nominal terms after also decreasing in 2023 as direct government payments shrink, production costs surge and growing supplies of grains and oilseeds send crop prices plunging to multi-year lows.

"Somewhere in there, you've got to make a living," Born said. "If there's anything left, I might have something to live on."

Growers have cut back on purchases and equipment repairs to stay afloat, while continuing to plant wheat as a crucial part of crop rotation in spite of low prices.

USDA expects the number of acres planted with winter wheat, which accounts for about two-thirds of U.S. production, to have declined 7% from 2023 to 2024. USDA forecasts spring wheat acres to expand by 1%, however.

Wheat can act as a cover crop and leave behind rich soil where farmers cam plant crops that are less likely to put them in the red.

"Farmers don't have a choice but to plant wheat," Ryan Ellis, a North Dakota wheat farmer, said.

Seeds for more profitable crops, such as lentils and peas, can be hard to come by and can only be sown in certain areas.

"Rotation dictates a lot of wheat acres. You feel like you're being forced into seeding it, but what else will you do?" Ellis said.

(Reporting by Heather Schlitz; Additional reporting by Julie Ingwersen; Editing by Caroline Stauffer and Marguerita Choy)