Corn makes lots of other things besides whiskey by the way; cereals, baking powder, vegetable oil. You get the point.
As you've probably noticed, there hasn't been much rain in the midwest this year - or in general, actually. In fact, a report from the USDA as of August 1
- 65% of U.S. farms are in areas experiencing drought
- Severe or greater drought is impacting 65 pecent of cattle production, and about 75 percent of corn and soybean production.
- As of August 1, more than half of U.S. counties had been designated as disaster areas by USDA in 2012, mainly due to drought.
I live in God's country (Kansas) and we've needed rain badly for the past 2-3 months. In fact, the state of Kansas has placed all 105 counties into a drought emergency status and all but 3 Kansas counties have been declared a disaster. The good news is that it's supposed to rain tonight; the bad news is that when we really needed the rain, it was nowhere to be found.
In May, which is a very crucial time on the corn growing timeline (most corn is planted in late April), Kansas received a statewide average of 1.10 inches of rain. That's not very much to get good seedling growth started. June and July didn't treat us much better which has really had a negative effect on both corn and soybean growth.
For visual explanation let's look at this ear of corn
that came from this field near my hometown in Anderson County, Kansas. That's my husband's hand and that ear of corn is only about 4.5 inches long. This is a sad, sad sight for farmers.
Then compare to this ear of corn from Wood County, Ohio, where they've gotten more rain this year than we Kansans- about 2.6 inches in May. That number is still a decrease from their normal precipitation but if you look at the difference that an inch of rain can have on a corn crop, that's a pretty important inch!
Here they are side by side - again, the corn from Ohio is on the left and although it's not near the size that farmers would like, it is better than our poor little Kansas ears.
Livestock producers (beef, pork) are having to cull their herds to avoid spending so much money on feeds. This could lead to a short-term increase in the meat supply which will lower costs. However, in the long run, once the shortage of corn and soybeans reaches the retail end (cornmeal, flour, cereal) we'll likely see an increase in grocery prices.
Furthermore, if producers are selling off parts of the herd now, they will have less to sell in 10-12 months which will probably lead to a long-term increase in meat prices.
So, if in the next 6 months you notice meat prices decrease only to increase again, please don't be upset with the farmer or grocery store. Farmers, especially livestock producers, are getting hit very hard this year. Many crop producers have insurance but that type of reassurance isn't available for beef, pork and poultry producers. They must feed their livestock regardless of feed prices because they're committed to utmost care for their animals. To read more about the strain on livestock producers and the perilous conditions that Mother Nature has created, you can read this blog post by pork producer, Chris Chinn.
We'd love to hear your thoughts and concerns about the drought or your situation. Leave us some comment love!
Until next time,
~ Buzzard ~