for-phone-onlyfor-tablet-portrait-upfor-tablet-landscape-upfor-desktop-upfor-wide-desktop-up
Change Suite

Midwest floods drowning crops; corn prices soar

CHICAGO (Reuters) - Floods sweeping through the U.S. Midwest have destroyed thousands of acres of corn and soybeans at a time when corn prices have already rocketed to record highs on worries there won’t be enough grain to meet export, biofuel and feed needs.

Crops have not gotten this much moisture since 1993, which resulted in the smallest corn and soybean crops in 20 years, said DTN Meteorlogix forecaster Mike Palmerino.

“The only comparison you can make at this point is 1993 for the effects of the wet weather,” he said. “That is the only other year that crop yields were significantly affected by significant rainfall.”

And with corn prices already over $7 a bushel -- up from $4 this time last year -- the western Corn Belt is in for more wet weather.

Another 0.75 to 2.5 inches of rain is expected to fall on Wednesday and Thursday. On Sunday, the region could see up to another 1.5 inches of rain, he said.

In Iowa, the top U.S. soybean state, up to 10 percent of the crop may have to be replanted -- and that’s on top of the 16 percent of the crop that has yet to get in the ground for the first time, said Palle Pedersen, of Iowa State University.

“A lot of the poorly drained fields are in pretty bad shape and we have another storm coming tonight,” he said. “It’s going to have a big impact on soybean yield.”

The relentless Midwest rains and flooding prompted the U.S. Agriculture Department on Tuesday to shave 3 percent from the projected U.S. corn crop this year, a rare move so early in the growing season.

“In corn, the water is washing away fertilizer so you are losing yields from that and it’s too late to replant corn anyway,” said Vic Lespinasse, analyst for grainanalyst.com.

The flooding is also closing nine locks and dams on the upper Mississippi River -- closing a 200-mile stretch to barges moving grain, coal and petroleum.

Three pork plants and a factory that makes pizza toppings will suspended operations due to rising flood waters.

WORST START TO CROP SINCE 1993

The proverbial saying -- “Rain makes grain” -- is not proving true this year and is reminding many grain traders and farmers of the torrential rains that washed out crops in 1993.

In 1993, rains began in early June and lasted well into harvest in September. This year, rains in April and May prevented many farmers from planting and recent storms will force them to replant at a late date that will reduce yields by as much as 50 percent.

So far the major difference between the rains of 2008 and 1993 has been the flooding that resulted as levees broke and the Mississippi River swelled over its banks.

The river in St. Louis is forecast to crest at 36.1 feet in the next few days. In 1993, the river crested at 49.58 feet, said Army Corps of Engineer spokesman Alan Dooley.

“1993 was such an extraordinary, extraordinary event but I think the probability of it is extremely low,” he said. “1993 was kind of like if someone in the (National Football League) runs 3,000 yards or someone batting .450 in Major League Baseball.”

The flooding in 1993 killed about 30 people and caused $15 billion in damage.

Additional reporting by Sam Nelson; Editing by Christian Wiessner

for-phone-onlyfor-tablet-portrait-upfor-tablet-landscape-upfor-desktop-upfor-wide-desktop-up