Commodities & Metals

U.S. Drought Widens, Crop Threats Increase

The worst drought in 56 years now threatens crops in a vast swath of the U.S. midsection, running from Indiana to the Sierras. The seasonal outlook through September shows about 70% of the country suffering either from persistent or intensifying drought.

From the U.S. Climate Prediction Center:

[The 8-14 day] … forecast pattern favors above-normal temperatures for much of far eastern Alaska and nearly all of the continental US. … The odds of El Niño are now more likely (and well above climatological odds), beginning Jul-Aug-Sep, and continuing through late winter…

  • Excessive heat for parts of the Central Plains, Midwest, and middle Mississippi Valley, Tuesday July 17 – Friday July 20
  • Severe drought for parts of the southeast, midwest, lower and middle parts of Mississippi Valley, central and southern Great Plains, Rio Grande Valley, Central and Southern Rockies, the Southwest, Great Basin, and Hawaii

That about covers the United States, with the exceptions of the Northwest, Northeast, and the Atlantic Coast.

The impact on crops is worsening. Of the corn crop, only 31% is now rated in “good” or “excellent” condition, while 34% of soybeans get those ratings. In Indiana, probably the hardest hit state, only 8% of the corn crop and 11% of the soybean crop is rated in “good” or “excellent” condition.

Corn prices are rising again this morning, hitting a high of $7.96/bushel before falling back to $7.83. Soybeans are flat so far, and wheat is up 0.3%.

Parched grazing lands means ranchers have to feed cattle from hay stocks, although live cattle and feeder cattle prices, which reached a peak in early June, have dropped back to rough parity with last year’s prices.

Paul Ausick

Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.