WASHINGTON, June 28, 2012 – Corn prices are climbing as blistering heat and dry conditions wilt crops in the Midwest, and a timely discussion at the Farm Foundation Forum Wednesday echoed concerns as the six to ten day forecast indicates rain is unlikely.
“It will rain when you need it the most, but once the crop is dead, I don’t know how much more you need rain after that,” said Armstrong Global President and fourth generation farmer Jay Armstrong at the Farm Foundation Forum on how drought reshapes agriculture.
The panel collectively identified four sectors to plan for a drought in the long term: data collection and research, development of strategies and technologies to respond to drought, willingness of farmers to adapt those strategies, and policies that encourage those first three sectors.
“I do not think the sectors are keeping pace with one another,” said American Farmland Trust vice president of programs Kitty Smith. “We need more data in order to adapt and develop reformed policies, we are collecting less data as a nation than we have for many years.”
Concerns over searing heat and dry weather baking crops and leading to lower harvests are causing a surge in prices. Corn futures are rising, escalating fears that this drought will raise food prices and lower corn supplies.
The NOAA Climate Prediction Center released the latest U.S. Seasonal Drought Outlook last week, suggesting dryness and moderate drought have been increasing both in extent and intensity across much of the Corn Belt region, the middle and lower Mississippi Valley, and much of the Great Plains.
The outlook concluded that drought is likely to develop, persist or expand across these areas. Harkening this year’s conditions to the decimating drought of 1987-1988, NOAA Climate Prediction Center’s Matthew Rosencrans said, “87-88 will be of the strongest analogs to this year.”
Armstrong added that farmers live with cycles, but he said farmers are notorious for thinking “whatever kind of weather I had last year is the kind of weather I am going to have this year and invariably they get fooled.”
“When your income and livelihood is dependent on something as fickle as weather, you learn in your first year of farming that it changes,” said Armstrong.
With unrelenting heat and dry conditions forecast for the Midwest this week, the USDA’s Crop Progress Report this week indicated that dry soil conditions persist with crop conditions sliding as moisture stress sets in.
According to the USDA’s Crop Progress report the amount of corn rated excellent in the 18 highest producing states surveyed held at 11% compared with the previous week, the good category dropped by seven points, from 52% to 45%. Corn rated in the poor-very poor category rose to 10% versus 7% last week.
At the state level, the Illinois corn crop as 22% poor to very poor, with 37% of the crop good to excellent. Indiana corn is 36% poor to very poor condition with 27% of the state’s crop is rated good to excellent. Another state experiencing a slide in condition from the previous week is Missouri, where 26% of the crop is rated poor to very poor, and 34% good to excellent.
Facing what Armstrong called an “unprecedented early season drought,” he said that it is hitting Indiana and Illinois the hardest with scorching temperatures, hot winds, little rain and no immediate relief in sight.
"The big concern now is as we approach pollination statewide [Indiana]," said Extension Corn Specialist Bob Nielsen in a Purdue University release this week. "We can lose an awful lot of yield potential per day with drought stress during pollination."
The National Drought Monitor, updated early Thursday, also indicated very dry conditions and abnormally warm weather during spring tapped moisture reserves across the Midwest. With the rain last week providing little relief to the central Plains to Ohio Valley, where deficits over the last 6 months ranged from 4 to 10 inches and locally over 12 inches.
“We ought to take a look at our whole research program in the United States,” said former Congressman Charlie Stenholm. “Are we really researching in areas that we need too looking at the future? Or are we still researching on past trends and past ideas?”
Stenholm continued noting that we are in a world market now, so “when we talk about weather, drought, production, biotechnology, and water use, all countries are having to deal with it. We are either going to compete or somebody else is going to win, that’s the inevitability.”
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