Drought 2012

[Ryan Ruck]

As you may or may not know, there is currently a severe drought now officially affecting more than half of all the counties in the US. I figure this is a big enough news it warrants its own thread.

This is what the current situation looks like:



Here is what the drought projections are:



As you can see, it doesn't look good.

This drought is already affecting commodity prices. Corn has jumped 50% in the last 6 weeks and soy is on the way up as well. The long term is that this is going to cause big jumps in all food prices. The corn not only is used directly in the food but is also used to feed livestock (there is also a lack of availability of hay). In the near term meat prices should be dropping as farmers cull their herds. In the long term, already high meat prices will be going higher. If you've got the freezer space, it might not be a bad time to start stocking up. My freezers are all pretty much full already.

[Ryan Ruck]

Corn Prices Hit Record As Crops Shrivel

July 31, 2012



Corn prices surged to a new record high Tuesday, as the worst drought in more than 50 years continues to plague more than half the country.

Almost 90% of the United States' corn crops are in drought ravaged areas, according to the U.S. Department of Agriculture, and nearly 40% are situated in the hardest hit spots.

Corn prices have soared more than 50% during the past six weeks as the crops continue to shrivel in relentless dry heat throughout the Midwest. They jumped another 0.7% Tuesday to a record high of $8.20 per bushel on the Chicago Board of Trade.

The Teucrium Corn ETF (CORN), which tracks a basket corn futures contracts and is up more than 44% over the past six weeks, slipped slightly on Tuesday.

Soybean prices, which are up more than 20% in recent weeks, also advanced. Prices rose 1% Tuesday to $16.63 per bushel, the highest since July 23. The Teucrium Soybean ETF (SOYB) gained slightly.

Soybean prices will likely continue to rise as the heat lingers in the area where soybeans are the major crop.

"Soybeans are second only to corn as the biggest agricultural product in the Midwest," said Alex Sosnowski, expert senior Meteorologist at AccuWeather.com. "While episodes of rain will continue over some agricultural areas in the Upper Midwest, Ohio Valley and East in the coming weeks, part of primary soybean growing areas will continue to be slammed by heat and drought."

Sosnowski notes that the next few weeks are crucial for soybeans. From now through mid-August is when soybeans finish their flowering stage and set pods, so mid-August is considered the cut-off for soybeans to receive rainfall without having a serious impact on production. Without rain, soybean yields are likely to be between 10% and 15% lower than the USDA had originally projected.

Prices for wheat, another grain, have also been rising on the back of corn and soybean prices. But on Tuesday, prices for wheat futures fell slightly, and the Teucrium Wheat ETF (WEAT) also dipped.

The iPath Dow Jones-UBS Grains Total Return Sub-Index ETN (JJG), which tracks the price of corn, soybeans and wheat, was slightly lower.

As the drought continues to spread, and grain prices keep climbing, consumers may be squeezed at the grocery store, since higher corn and soybean prices lead to higher prices for beef, chicken, vegetable oil and other staples.

[Ryan Ruck]

Wells Drying Up in Wildwood, Missouri

July 31, 2012

The drought is making water scarce in a rural area of western St. Louis County.

The St. Louis Post-Dispatch reports that private wells for potable water supplies are drying up in part of Wildwood. City officials are getting calls from property owners with some saying the wells have outright stopped providing water.

Councilman Ron James says a Missouri Department of Conservation monitoring well shows that the water table is down about 60 feet since May.

The city is investigating possible suppliers of potable water so that it could refer homeowners to them.

[Ryan Ruck]

It's somewhat ironic... When the weather started getting dry, I was joking with a friend that not only might Obama get to oversee another depression but that maybe he'd even get to oversee another Dust Bowl.

[American Patriot]

sever drought

Hope we can find better servers!

/chuckles

[Ryan Ruck]

Hope we can find better servers!

/chuckles

There...

[American Patriot]

Damned right.

If you can't spell it correctly then... well... I guess it isn't important! hahaha

I don't usually bother with correcting things (or mentioning it) unless it severely changes the meaning of the sentence. hahaha

[Malsua]

I need some drought. Right now we're getting frickin rain every other day. My trenches are currently exposed and I need them to stop collapsing because of all the fookin rain!

[American Patriot]

half the country has it.

Maybe you should move?

/chuckles

[Phil Fiord]

Same here for rain. Near daily afternoon squalls.

Ryan, that is the best Grammar Nazi symbolic i have ever seen and I see many these days.

As to food prices. Yes indeed, they are rising.

Corn is only about 5% used for food in the US, if I recall correctly. It is a small number though. The rest goes to fuel and feed. Recall that Corn Syrup is used to sweeten many things, so while used in food, it is an indirect use from corn not directly consumed as corn. Sugar should not have been replacedm but was due to the former cheaper price before corn was used in fuel.

[Ryan Ruck]

This is a common site when I'm out driving. It might be hard to tell but most of that corn is barely half height.

The other thing you'll see is corn that is full height but barely has any ears on it. That's what the corn around my place looks like. I'll post a picture of that later.

Though it isn't so bad as other areas where the crop is non-productive and has to be cut for silage or outright wilted and have had to be tilled under.

[Ryan Ruck]

Here's the corn around my place. This picture was taken about 2 weeks ago.

It is full height but, it's hard to tell, there are hardly any ears on those stalks. A lot of the ones that are on there are small. Only a few are regular sized.

[Ryan Ruck]

Missouri University Professor Says Drought Could Spark Riots and Deaths

July 24, 2012

The lack of rain and extreme heat hitting Missouri is killing two of the world's most important food production crops--corn and soybean crops. An MU Professor of Agriculture and Applied Economics told KOMU 8 News this causes a rise in the price of the crops, which will likely lead to starvation in parts of the world.

The United State Department of Agriculture spends $1.5 billion each year sending food aid to hungry people in countries across the world. That amount of money feeds 33 million people. But according to Dr. Michael Monson, MU Professor of Agriculture and Applied Economics, the number of mouths the department can feed is decreasing.

Monson told KOMU 8 News the price of corn and soybeans increased by 30% since the start of the drought. The increase means the U.S.D.A. can now only afford to feed 24 million people. Monson said that leaves 9 million people without help, which will likely lead to deaths.

Monson said right now, it is impossible to estimate a number of deaths that will occur from the lack of U.S. crops, but it could range from thousands to millions of people. He said even worse, is the possibility of food riots.

"All of this won't really work through the system for 9 to 12 months...there are predictions for considerable unrest over food supplies in 2013," Monson said. "Unfortunately food has been and probably will continue to be a political tool. There are bodies of research out there that predict food riots based on food prices. They attribute the Arab Spring demonstrations and protests to the high food prices in 2007 and 2008. Tunisia, Algeria, Egypt, all of this was in some part is due to increased food prices," he explained.

Food riots would likely happen in countries where the majority of the country depends on U.S.D.A. Food aid. Monson said there is no other previous situation to compare the implications that will arise from the drought currently hitting the U.S.

Monson said The U.S. is the world's number one food provider. He said the drop in U.S. crops becomes life-threatening for other countries.

"Many people think of it as just affecting this area--they walk out their front door and see the dead crops and think Missouri is in the worst situation, but that's not true." he explained. "The U.S. only spends about 10% of its annual income on food, but some other countries spend anywhere from 70% to 80%, so you talk about a food increase and this becomes life threatening."

Monson said, the main affect the lack of corn and soybeans will have on the U.S. is a spike in the price of groceries. He said beef, poultry, dairy, and corn prices have all gone up since the start of the drought.

According to Monson, rainfall in the next couple of weeks could save portions of the soybean crop, but he described the corn crop as "unsalvageable."

[Ryan Ruck]

Photos: Drought Disaster 2012

July 31, 2012



A Struggle for Farms
Crops wither. Topsoil lies cracked and parched. Reservoirs shrink, leaving dry beds exposed to the sun. The widest drought to grip the United States in decades is getting worse with no signs of abating. The drought covering two-thirds of the continental U.S. had been considered relatively shallow, the product of months without rain, rather than years, but a report released last week showed its intensity is rapidly increasing, with 20 percent of the nation now in the two worst stages of drought, up 7 percent from the previous week. Corn and soybean crops -- including the one above near Nebraska City, Neb.-- have been devastated in places, and livestock farms are suffering, too. It's a huge disappointment for farmers who only a few months ago had expected record harvests. Here are more photos from around the nation of the drought's impact.





Oakwood, Ill
Corn picked from four fields in drought stricken Oakwood, Ill.





Oakwood, Ill
The inside of corn picked from four fields in drought stricken Oakwood, Ill.





Indianapolis
Ronnie Sharp, left, and Brandy Birdwell of Imperial Painting, spray turf paint on a drought ravished lawn outside a auto repair shop in Indianapolis. Without cutting the color will last four to six months.





Paoli, Okla.
Dry corn is pictured in a field as rain clouds threaten near Paoli, Okla., on Thursday, July 26, 2012. The rain provided a brief respite from the drought.





Farmingdale, Ill.
Central Illinois cattle stand in a pasture struggling from lack of rain and a heat wave covering most of the country. The nation's widest drought in decades is growing more severe.





Ashley, Ill.
Marion Kujawa feeds corn to his cattle near Ashley, Ill. Many farmers in the Midwest have been selling off their cattle because of the high price of hay and corn in the drought-stricken region. According to the Illinois Farm Bureau, the state is experiencing the sixth driest year on record.





Woodward, Okla.
Sunflowers droop in the Oklahoma heat near Woodward, Okla. The nation's widest drought in decades is spreading, with more than half of the continental United States now in some stage of drought and most of the rest enduring abnormally dry conditions.





Ashley, Ill.
Marion Kujawa looks over a pond he uses to water the cattle on his farm in Ashley, Ill. Kujawa has been digging the pond deeper after it began to dry up during the current drought.





Hays, Kansas
A cow looks for something to eat as it grazes in a dry pasture southwest of Hays, Kansas. A new report shows the drought gripping the United States is the widest since 1956.





Owensboro, Ky.
Farmer Joe Fischer holds ears of corn showing the variety of kernal development at Fischer Farms Inc. in Owensboro, Ky. Normally the silks would already be brown, Fischer said. "There is no pollen left because the silks were delayed ... because it has been too hot and dry," Fischer said. All five Owensboro-area counties have been designated primary disaster areas because of drought.





Nashville, Ill.
Steve Niedbalski chops down his drought and heat stricken corn for feed in Nashville Ill. Farmers in parts of the Midwest, dealing with the worst drought in nearly 25 years, have given up hope for a corn crop and are mowing over their fields and baling the heat withered plants for livestock feed.





West Lafayette, Ind.
As water recedes, the bottom of Celery Bog continues to crack and dry out in West Lafayette, Ind. Large areas of the bog that are normally covered with water now give way to a variety of thick weeds. Not much can be done to raise the Celery Bog's water level. So naturalists are trying to learn from the effects of the statewide drought, which has caused much of the West Lafayette wetland to evaporate.





Noblesville, Ind.
Boats sit on the cracked bottom of a dry cove at Morse Reservoir in Noblesville, Ind. The reservoir is down nearly 4 feet from normal levels and drops a foot every five days.





Farmingdale, Ill.
Corn stalks struggling from lack of rain and a heat wave covering most of the country lie flat on the ground in Farmingdale, Ill. The nation's widest drought in decades is spreading - more than half of the continental U.S. is now in some stage of drought, and most of the rest is abnormally dry. Illinois Governor Pat Quinn announced various assistance programs available to farmers and residents in drought impacted areas within the state.





Hopkinsville, Ky.
A field of corn near the western Kentucky city of Hopkinsville shows signs of drought damage. Building heat could worsen conditions and crops.

[Ryan Ruck]

Punishing Drought In Midwest Shows No Sign Of Abating

July 17, 2012

Broiling heat blanketed much of the Midwest again on Tuesday, exacerbating the region's worst drought in more than 50 years and devastating corn, soy and other vital crops.

Across the country's agricultural heartland, elected officials met with farmers and ranchers affected by the growing disaster promising government relief.

In Missouri, Governor Jay Nixon announced on Tuesday that all 114 counties in the state have been designated as natural disaster areas due to the drought, making farmers eligible for government loans or other assistance.

Before Tuesday, 17 counties had received disaster status.

In Iowa, Governor Terry Branstad convened a hearing to discuss the drought and its effect on the state's pork industry, which relies heavily on corn feed.

"It's important that we do all we can to help people through this difficult time," Branstad told local radio station KILJ. "And obviously more rain would help."

Although weather forecasters said some parts of the parched region might get some rain next week and help pull corn prices off near-record highs, analysts slashed their forecasts for U.S. corn production by another 7 percent on Tuesday, a Reuters poll found.

From Chicago to St. Louis to Omaha, Nebraska, temperatures eclipsed 100 Fahrenheit (37.8 Celsius) and the National Weather Service issued heat advisories across Midwest and mid-Atlantic states.

Many of the heat advisories don't expire until next week. Temperatures in Kansas City, Kansas, for instance, are expected to hit 104 F (40 C) on Wednesday. In Topeka, the intense heat is drying up soil so far beneath the surface that water lines are cracking.

So far this month, 2,202 heat records have been broken across the United States and another 787 tied, according to the National Climatic Data Center.

Another 14 U.S. cities set new record highs by 8 p.m. EDT (0000 GMT) on Tuesday, according to Accuweather.com, including St. Louis, Milwaukee, Detroit and Syracuse, which all topped out above 100 F.

Those temperatures have contributed to the worst drought since 1956, the National Oceanic and Atmospheric Administration said in a report posted on its website.

FROM CRISIS TO HORROR STORY

About 55 percent of the contiguous United States is in a drought, just as corn plants should be pollinating, a period when adequate moisture is crucial. The United States ships more than half of all world exports of corn, which is made into dozens of products, from starch and ethanol to livestock feed.

"We're moving from a crisis to a horror story," said Purdue University agronomist Tony Vyn. "I see an increasing number of fields that will produce zero grain."

The soonest rain is expected in the Midwest is the middle of next week, said Jason Nicholls, meteorologist for AccuWeather.

The new forecast calls for rains of 0.2 to 0.7 inch (5 mm to 18 mm) around the region, up from earlier outlooks of 0.1 to 0.6 inch.

The dry weather and intense heat likely will continue through August, further damaging the corn crop, AccuWeather said.

Corn prices are at 13-month highs and have surged 45 percent this summer, with analysts expecting the lingering drought to result in the smallest U.S. corn crop in five years.

As the worst drought since the Eisenhower administration begins to expand to the northern and western Midwest, areas that had previously been spared, analysts are slashing corn yield estimates by the hour.

"We need soaking rains now. We need two-to-three-inches and that's not in the forecast," AgResource Co analyst Dan Basse said.

EFFECT ON FOOD PRICES

In April concern mounted that near-record spring corn plantings would sharply increase supply and push corn prices below $5 per bushel.

Now, because of the drought, corn prices are flirting with $8 per bushel, and that could boost food prices.

With much of the Midwest pasture laid waste by the drought and ranchers facing climbing feed costs, many ranchers have begun liquidating their herds, which could translate into higher prices for meat next year.

"Based on my conversations with producers, I would say 75 percent of the corn crop in the heart of the drought is beyond help," said grains analyst Mike Zuzolo, president of Global Commodity Analytics & Consulting in Lafayette, Indiana.

Weather problems were also reported in Eastern Europe and Asia, mirroring drought that dented Argentina and Brazil's last harvest.

Black Sea grain producer Kazakhstan was preparing for a below-average crop this year due to an "alarming" drought in the country's main growing regions.

The United Nations food agency said earlier this month that the U.S. drought was expected to see global food prices snap three months of declines in its July figures.

The drought is even harming equipment makers. Shares of Deere & Co, the world's largest maker of tractors and combines, fell on Tuesday after a JPMorgan analyst said the U.S. drought was likely to harm sales in 2013.

[American Patriot]

And there go the grain prices....

• August 10, 2012, 4:29 p.m. ET

U.S. GRAIN AND SOY REVIEW: Corn Futures Fall On USDA Report


--U.S. corn futures fall as traders are disappointed by USDA forecast for domestic inventories
--Wheat pressured by cheaper corn and by higher-than-expected U.S. wheat-inventories forecast
--Soybeans rise on lower supply forecasts

By Owen Fletcher CHICAGO--U.S. corn futures fell Friday, pressured by disappointment among market participants that a government forecast for domestic corn inventories came in no lower than analysts had expected.


Chicago Board of Trade September corn futures settled down 18 1/4 cents, or 2.2%, at $8.00 a bushel.


Corn futures jumped at first when the U.S. Department of Agriculture issued its monthly supply-and-demand report on Friday morning, including a greater-than-expected cut in the agency's forecast for U.S. corn production. The USDA projected corn output of 10.779 billion bushels, down from its last forecast of 12.97 billion bushels.


September corn futures reacted by trading as high as $8.43 3/4 cents a bushel in the minutes after the report's release, setting a record intraday high for the front-month contract.


But corn prices then began to fall on disappointment over the USDA's forecast for domestic corn inventories, which the USDA projected at the end of the 2012-13 marketing year will be 650 million bushels, in line with predictions by analysts. Analysts said that forecast made the report neutral for corn overall, instead of price-supportive.


Speculative buyers likely sold futures to take profits after the initial jump in futures, also sending prices lower, said Arlan Suderman, an analyst in Wichita, Kan., for agricultural trade publication Farm Futures.
Some analysts said corn prices may still need to rise further to choke off more demand, in line with tighter supplies. The USDA on Friday cut its demand forecasts for corn used in ethanol production, in animal feed and for export.


Wheat futures followed corn to jump higher initially after the report's release, but then fell and traded lower for most of the session. Corn and wheat prices are linked as the two crops compete in the animal-feed market.


Wheat took extra pressure from a higher-than-expected USDA forecast for domestic wheat inventories.
CBOT September wheat fell 27 3/4 cents, or 3.0%, to $8.85 1/4 a bushel. Kansas City Board of Trade September wheat fell 22 cents or 2.4% to $8.93 a bushel. MGEX September wheat fell 23 1/2 cents or 2.5% to $9.35 1/2 a bushel.


Soybean futures also pared their post-report gains Friday, but still finished the session higher. The USDA cut its U.S. soybean production forecast by more than expected, to 2.69 billion bushels from 3.05 billion bushels.
Soybeans also got a boost after the USDA announced the sale of 290,000 metric tons of soybeans by private exporters for delivery to China during the 2012-2013 marketing year. A series of similar announcements this week has highlighted continued strong demand for soybeans despite elevated prices.


August soybeans, thinly traded ahead of the contract's Tuesday expiration, rose 15 cents, or 0.9%, to $17.09 1/2 a bushel. Most-active November soybeans rose 12 1/2 cents, or 0.8%, to $16.43 3/4 a bushel.
Write to Owen Fletcher at owen.fletcher@dowjones.com

[Luke]

Luckily one of my neighbors harvested sweet corn about a month ago. I gave him $20 for 21 dozen ears of corn. After we cut it off the cob we ended up with 40 lbs of corn in our freezer, I think this will get us through the winter.

[Ryan Ruck]

Good deal!

I was just out tending to the yard and as I was riding my lawn tractor along the corn I was giving it a good close up look. I'd say most all the stuff around me is almost a complete loss. They might get a worthwhile ear here or there.

I was going to take some close up pictures but I ran out of daylight. I'll try to remember to do so tomorrow.

We've had some rain over the last two weeks but it has been mostly heavy downpours that haven't really had a chance to soak in. What we need are a good couple days of steady rain. Then again, so does most of the country! At least it has helped my yard green back up but its all been too late to really help the corn and soy.

[Malsua]

NJ is normal or up as far as rain goes. There is corn around here that's doing fine. Not quite the midwest by any stretch but south Jersey has about as much corn as Ohio did. It's everywhere.

[Ryan Ruck]

Here's a picture of the rare, full size ear:



But here's what most of the crop looks like...



No ears at all:





And then what the majority of the ears that have sprouted look like. Very tiny:





And I'm not exactly sure what has happened with these but many look like this: