U.S. corn growers “farming in hell” as drought, heat portend another global food price spike

Things are grim if you’re a U.S. corn farmer right now:

The worst U.S. drought since Ronald Reagan was president is withering the world’s largest corn crop, and the speed of the damage may spur the government to make a record cut in its July estimate for domestic inventories. Tumbling yields will combine with the greatest-ever global demand to leave U.S. stockpiles on Sept. 1, 2013, at 1.216 billion bushels (30.89 million metric tons), according to the average of 31 analyst estimates compiled by Bloomberg. That’s 35 percent below the U.S. Department of Agriculture’s June 12 forecast, implying the biggest reduction since at least 1973…“The drought is much worse than last year and approaching the 1988 disaster,” said John Cory, the chief executive officer of Rochester, Indiana-based grain processor Prairie Mills Products LLC. “There are crops that won’t make it. The dairy and livestock industries are going to get hit very hard. People are just beginning to realize the depth of the problem.”

– Jeff Wilson, “U.S. Corn Growers Farming in Hell as Midwest Heat Spreads,” Business Week (Bloomberg News), July 9, 2012

And although despite the drought “U.S. production in 2012 is expected to rise 9.5 percent from last year to a record after farmers sowed the most acres since 1937,” the overall outlay of the situation also hinges on global economic circumstances, which in turn highlights the troublesome nature of globalization itself):

Corn’s rally also may stall if Europe’s widening debt crisis and a faltering global economy erode record demand for the grain. The International Monetary Fund will reduce its estimate for growth this year because of weakness in investment, employment and manufacturing in Europe, the U.S., Brazil, India and China, Managing Director Christine Lagarde said July 6. “The shrinking global economy is the elephant in the room that no one wants to discuss as long as U.S. crops are under siege,” said Dale Durcholz, the senior market analyst for Bloomington, Illinois-based AgriVisor LLC. “Corn demand at $5 is much more robust than when it costs $7.”

And to muddy the waters and add more concern to the mix, Voice of America reports that the whole thing may lead to another food price spike like the kind that set off global chaos multiple times in the past five years. It also points out that the talk of a record U.S. corn crop may well prove to be hot air:

World food prices are likely to rise in the coming months in the wake of record-breaking temperatures and drought in the major maize and soybean producing regions of the United States, economists say. It would be the third spike in food prices in the past five years. Previous hikes – during 2007 and 2008, and again in 2010 and 2011 — triggered riots and social instability in dozens of countries around the world… Despite early predictions of a record maize crop, estimates have plummeted after a string of record-high temperature days and dry conditions stretching across the farm states of the U.S. Midwest. “We need rain, and it doesn’t look like we’re going to get it,” says Iowa State University economist Dermot Hayes. As the world’s leading exporter of maize and a top soybean exporter, what happens in the U.S. affects global prices, according to Hayes. Mexico and Central America, where maize is a key staple, will be affected directly, but Hayes expects others to be affected indirectly as well. “Bread prices in North Africa will go up, and chicken prices in China, pork prices in China, et cetera,” he says. “And there are going to be some very unhappy people.”

[W]hile rising prices may threaten food security for the poor, experts note they can create unrest among consumers whose standard of living had been rising. Iowa State University’s Dermot Hayes says it could be an irritant in China, a country with a growing middle class but significant social inequality. “It’s a tinderbox over there,” he says. “It’s not a real homogenous or pleasant society the way it’s structured right now. So there could be some issues.”

- Steve Baragona, “US Drought Could Trigger Higher Food Prices,” Voice of America, July 9, 2012

Since food is more fundamental to physical life than anything besides water and air, maybe this all adds weight to, or otherwise interacts with, the trend Will Oremus noted last week regarding American belief patterns about climate change:

Before the financial crisis hit, Americans were pretty sure that the globe was warming, and that humans were causing it, and that it was kind of a big deal. As the economy slumped, Americans decided that climate change wasn’t actually happening — and even if it was, it wasn’t our fault. And now, after a flurry of wild weather — deadly tornados, floods, droughts, an uncommonly mild winter, and recent heat waves — U.S. residents are back to believing that global warming is real. But we’re still hesitant to take the blame. These generalizations are based on a series of Yale University studies over the last few years…[O]ur resurgent belief in global warming seems to be a function of the weather.  A separate Yale survey this spring found that 82 percent of Americans had personally experienced extreme weather or natural disasters in the past year…To the science-minded, it might be disconcerting that the weather drives Americans’ beliefs about climate change. After all, scientists’ models have been showing and predicting climate change for decades…Still, it’s at least good to know that most Americans are aware enough of what global warming is supposed to entail — i.e., not just warmer temperatures but bizarre weather patterns — to know it when they (probably) see it.

– Will Oremus, “Now That the Weather Is Going Crazy, Americans Believe In Climate Change Again,” Slate, July 6, 2012

About The Teeming Brain

The Teeming Brain is a blog magazine exploring the intersection of religion, horror, the paranormal, creativity, consciousness, and culture. It also tracks apocalyptic and dystopian trends in technology, politics, ecology, economics, the arts, education, and society at large.

Posted on July 11, 2012, in Environment & Ecology and tagged , . Bookmark the permalink. 2 Comments.

  1. brandeditems8

    Regardless if you believe in climate change, let this be an issue where we can unite and clean the planet. One thing is for sure: Remove pollution from air, land, and sea, it will be better for all of us. You will know them by their fruits.

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