BILLINGS -- Back in January, when wheat was selling for more than five times its historic average, there were farmers swearing the low-priced days of $4-a-bushel grain were history.

This week, history repeated itself. In a sign that the one of the hottest sectors of the Montana economy is rapidly cooling, cash grain prices fell to $4.56 a bushel on the low end for ordinary winter wheat. That's roughly two thirds the price local grain elevators were willing to pay in August and far below the $7 a bushel price farmers previously said they need to meet rising diesel and fertilizer costs.

At least for now, wheat's unprecedented heyday is on hold.

"It's pretty scary going into the winter months to see prices drop," said Lola Raska, Montana Grain Growers executive vice president.

Raska attributes the decline to a better-than-expected global wheat crop and a number of speculators leaving the grain futures market.

The price of raw materials, not just wheat, but oil, corn and other commodities skyrocketed during the past year, in some cases jumping 177 percent.

Market speculators were part of the reason, putting money down on future crops, certain they'd be able to sell for even more ahead once the harvest was actually in. Farmers were able to lock in selling prices for grain in some cases two years away from being planted.

Opportunities for that kind of forward contracting began to diminish in July when wheat's outlook became less predictable, Raska said. Grain elevators stopped offering forward contracts.

But speculation wasn't the only factor at play in the unwinding of wheat prices. For months, farmers benefited from a weak U.S. dollar, which made wheat cheaper on the global market. Once the dollar's value began trending upward, U.S. grain became less attractive to world buyers, said Dave Buschena, an agricultural economist at Montana State University in Bozeman. That fall in wheat prices precedes the troubles of the U.S. and global financial markets and is not a result of it.

"The main story is the strength of the dollar, which has was getting stronger throughout August," Buschena said. "And the U.S. Department of Agriculture was warning that wheat production worldwide was going to be up."

Globally there was a projected wheat production of 676 million tons, which was 5.5 million tons above what was expected even a month earlier, Buschena said. Much of that wheat is coming from Eastern Europe, where wheat was abundant but protein levels were low.

Low-protein wheat doesn't pay as well as high-protein wheat. In Montana, as in the rest of the world, it's the lower-protein wheat that's selling in some cases for less than it costs to produce it. Because of rising input costs, that is, the cost of diesel, fertilizer, herbicide and labor, farmers say they need to get nearly $7 a bushel for their wheat to break even.

That break-even price should trend downward as the cost of fuel and fertilizer drops. Diesel no longer costs $4 a gallon as it did in the spring. Fertilizer prices should trend downward also, Buschena said, which means by the time spring wheat farmers are planting, the price they need to break even should be less. The same cannot be said for farmers planting winter wheat.

"We just got done seeding yesterday," said Karen Schott, who farms winter wheat in Broadview with her husband, Keith. "Most of us are putting down fertilizer that already doubled in price."

Regardless of what wheat prices do, input costs are still going up. Roundup is $50 a gallon. Fuel isn't cheap. The cost of federally backed crop insurance per acre has nearly doubled.

A year ago, Schott said, farmers who locked in a sales price early for winter wheat were cursing themselves. They secured prices of $5 to $6 a bushel only to watch prices of $13 emerge afterward. This year, the early prices of $7 and $8 a bushel are looking pretty good. Those who were waiting for the late deals of 2007 got 2006 prices instead.