Interesting article at Zerohedge today: Farmageddon Looms: Only 30% Of US Corn Fields Have Been Planted, 5 Year Average Is 66% U.S. farmers seeded 30% of the U.S. 2019 corn crop by Sunday, the government said, lagging the five-year average of 66%. The soybean crop was 9% planted, behind the five-year average of 29%. Iowa: 48 percent planted – 5 year average 76 percent Minnesota: 21 percent planted – 5 year average 65 percent North Dakota: 11 percent planted – 5 year average 43 percent South Dakota: 4 percent planted – 5 year average 54 percent
Yeah, wet ground is the problem....and LOT of rain today still in the upper mid-west. Lot of farmers switch from corn to soy beans if planting time gets too late.....but the biggest market for soy beans has been China in the past, meaning the price will suck this year. Article says corn yields decrease 2%/day for each day planted after May 15th.
The coming Ice Age... We had thunderstorms roll thru Anchorage last night. Surface temps at the time - 50F. Pretty strange...
But the shorter the days for corn, the lower the yield, and you may not find any 90 day seed as it had to be raised last year and they only raise what they think they can sell. Brother lives in Mn, his brother in laws, in their 60's and 70's, raise corn, 4,000 acres or so and soy beans, 1,000 acres or so, and problem is not only wet fields to plant, but the machines are so big that they easily get stuck, in some cases only planting part of a field, and no one has any idea what bean prices will be in fall. White knuckle time as you roll the dice and perhaps lose a lot of the cushion you have built up over the years. Very few young farmers and this year may thin the herd even more. In Iowa in 1998, the average price for an acre of farmland was $1,700 and in 2018, it was $8,080. Not adjusted for inflation, a bushel of corn was $2.62 in May 1998, peaked at $6.95 in July 2012, and was $3.87 in May 2019. Hard to see how a lot of farmers are going to make it with the average corn yield about 160 bushels and a gross of about $620 an acre for corn with $8,000 land, $500,000 combines, $200,000 tractors, $3.00 gallon diesel fuel, with Roundup ready hybrid seed, up to $120 an acre for seed, fertilizer, insecticide, herbicide, labor, etc, I would not want to be risking my retirement savings on planting a crop.
An agricultural shortfall of this magnitude would mean widespread famine in the average 3rd world country. That won't happen here because we have more alternative foods, more options, and more money. The poorest Americans will have some hard food choices to make, even so. One immediate effect of the corn shortfall will be a large rise in the price of feed. A lot of livestock is going to get more expensive to feed up. Everything from chickens to beef. Another effect will be a rise in the price of corn oil. Just about every food industry uses it in massive quantities. And a lot of people that still cook at home. That, in turn, may cause a large spike in the price of gasahol. (And what a scam that is!) Or possibly even shortages at the pump. Fast food prices will rise, and I wouldn't be surprised to see some secret rationing going on. We don't need ration cards anymore--just a polite sign in the supermarkets saying "Limit: 2 per customer." Or some such. When corn oil goes up, olive oil will go up, too. And so will lard. And every other cooking oil. I think if a person did a little serious shopping ahead right about now they could make 40% on their food money over the next few months. The real big question next is "What's going on with wheat?"
I doubt very much that the average person in Venezuela thought 10 years ago when they were being disarmed that they would be suffering from severe malnutrition in a few years and we tend to forget that for many years it had the highest standard of living in all of Latin America. It is living proof, as is Zimbabwe, that killing the golden goose to get all your wealth right now is not a wise decision. Reading the speeches from there 10 to 15 years ago and they sound like they were written by the present day liberals in the USA. YMMV
When feed prices go up, watch for meat prices to fall, but milk prices to go up. Farmers can't afford feed and have to sell their herds, And the farmer DOES NOT get to set the prices he buys for or sells for.
If we could only get the FedGov out of the "putting food in your gas tank" mindset, thing would be a lot better - on many fronts.
Gee, wouldn't it be a shame, if, due to a corn shortage, the government decided to forego putting ethanol in the gasoline, for a while?
With the die-off of the Chinese hog herds they will not be buying much grain for feed. Also, if the Chinese buy their corn and soybeans from South America, then American farmers need to sell to South America's former customers. There is only so much grain in the world and all of it gets bought every year. I know that China is the biggest market, but they are not the only market. There is no reason for farmers to panic over the trade war.
