Wichita ? With the winter wheat harvest now well under way across the nation’s breadbasket, government reports released Friday forecast bountiful crops in Kansas and record wheat production globally.

“We are already seeing a downtrend in wheat price, which is normal at harvest,” said Mike Woolverton, an extension grain market analyst at Kansas State University. “But I think the wheat traders were taking into consideration a larger production of wheat around the world.”

Global wheat production is expected to hit a record 664 million tons with expectations of large crops in Australia, Europe and the United States, the U.S. Department of Agriculture reported. The increase in those areas more than offset the smaller crop forecast for Iran.

“Another thing that came out of this report that was almost hidden was the severe drought in the Middle East. They are not a major wheat producer, but their wheat crop is going to be severely impacted by the spreading drought,” Woolverton said. “They are going to be buying a lot of wheat.”

In its monthly World Agricultural Demand and Supply Estimate report, the Agriculture Department predicted the average farm price of wheat for the 2008-09 marketing year at between $6.75 and $8.25 per bushel.

Wheat stocks are at a 60-year low in the United States, with global wheat stocks at a 30-year low, Woolverton said.

“Even though we are going to have increased global production for wheat, I think demand is going to be very strong and will absorb that additional production,” he said.

Woolverton said he expected a short-term downturn in wheat prices but anticipated that prices would recover in the fall and winter.

In Kansas, the wheat production forecast was raised to 366.6 million bushels, Kansas Agricultural Statistics Service said in a separate report. That is 3 percent more than last month’s forecast before the harvest got under way. It is also 29 percent higher than last year’s freeze-plagued crop.

The nation’s winter wheat forecast also went up Friday to 1.86 billion bushels, Kansas Agricultural Statistics Service said. That is up 3 percent from last month and up 23 percent above last year.

The Agriculture Department’s report also provided the first corn production estimate since the agency adjusted its acreage numbers after widespread flooding in the nation’s corn belt.

U.S. corn production was pegged at 11.71 billion bushels, down 20 million bushels as the agency adjusted its projected average yields by a half bushel per acre.

The industry expects projected yields to drop even more by the time the next report is issued in August as statisticians get a better grasp on the extent of the flood damage, Woolverton said.