By Ernest Scheyder
July 17 (Reuters) – Broiling heat blanketed much of the U.S.
Midwest on Tuesday, exacerbating the region’s worst drought in
more than 50 years and devastating corn, soy and other vital
crops.
From Chicago to St. Louis to Omaha, Nebraska, temperatures
eclipsed 100 degrees Fahrenheit and the National Weather Service
(NWS) issued heat advisories across Midwest and mid-Atlantic
states.
Many of the NWS heat advisories don’t expire until next
week. Temperatures in Kansas City, Kansas for instance, are
expected to hit 104 degrees Fahrenheit (40 degrees Celsius) on
Wednesday.
The current drought is the worst since 1956, the National
Oceanic and Atmospheric Administration said in a report posted
on its website.
In Iowa, Gov. 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.”
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 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 crop to
deteriorate further as the drought lingers.
The U.S. Department of Agriculture (USDA), in its weekly
crop progress report on Monday, said just 31 percent of the corn
crop was in good to excellent shape, down from 40 percent a week
earlier and below analysts’ average estimate of 35 percent.
Soybean conditions fell to 34 percent from 40 percent in the
good to excellent category, below estimates for 35 percent.
“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.
Despite what little precipitation may come in the next few
days, arid and hot conditions will stick around for the next few
weeks, said Commodity Weather Group (CWG).
“Showers may scatter into the south and east Midwest, but
relief for the belt as a whole would still be limited,” said CWG
meteorologist Joel Widenor.
