The world is awash with wheat. Record northern hemisphere production has capped four years of supply exceeding demand. Silos are overflowing, grain is being stored on the ground where weather permits it. After the dairy farmers media opportunity, the background for the next rural double header by the Prime Minister and his deputy could be a combine harvester.

Depending on how you want to look at it, the latest drop in prices has taken American wheat in US dollars to a 10-year low and a 16-year low in Australian dollars. Australian wheat prices also have plunged to multi-year lows. In real terms, allowing for inflation, it's arguable they are the lowest in generations, perhaps ever.

The Australian Bureau of Agricultural and Resource Economics and Science June quarter commodities outlook forecast the world wheat indicator price would fall 10 per cent in 2016-17 to a 15-year low. That was before the International Grains Council last week increased its production forecast to a record 743 million tonnes, up 1 per cent on last year's record. The Chicago benchmark price dropped a sharp 4.4 per cent on Friday night and has continued to weaken.

ABARES expected Australian wheat exports to increase by 4 per cent this financial year to 17.2 million tonnes, but the value of the exports was forecasts to fall by 7 per cent to $4.9 billion because of the lower prices.

So far this week, Australian Prime Hard wheat has been struggling to hold $200 a tonne FOB Kwinana as international prices continue to slide. The disparate nature of Australia's wheat markets, ports and growing areas mean an overall benchmark price is only possible to calculate well after the season, but AWB is quoting $171 a tonne for APH1 in Nyngan.

Even Australia's geographical advantage for Asian markets has been effectively lost this year. There's also a shipping glut that has cut transport prices for Russian grain that has no way of being stored and is therefore being dumped wherever possible. The ABC reported Indonesian mills can buy Black Sea wheat cheaper than Australian grain.

Wheat is second only to cattle in the league of Australian agricultural produce, yet the dive in prices and the ramifications for everything from the federal budget deficit to our inflation rate have barely broken out of the Country Hour. The reason, according to those whose job it is to monitor the unfolding challenge, is that the fall is no surprise. It's been a predicted rising tide, rather than a tsunami. 

So cheaper bread should be on the menu – the Reserve Bank's inflation target harder to reach with low interest rates having no impact on such prices. The Commonwealth will collect less tax, if any, from wheat growers. And farmers will belatedly take the pricing hint to diversify into other crops.

Grain Growers' policy general manager, David McKeon, seems suitably stoic in the face of yet another challenge. Yes, global stocks and the likelihood of a bumper crop this year are at the forefront of farmers' minds and there is no doubt ongoing low prices will hit their bottom line hard.

"Ongoing low prices are likely to expose in particular farm businesses who have recently expanded or have not been able to control their cost base," he said.

"The Australian grain production sector has faced challenging times in the past, whether they be climate or market related, and has constantly proven to be adaptive and resilient."

Yep, farming can be cruel.