The US growing season begins with global food supplies at stake

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Farmers from Nebraska to Ohio are heading into the final stretch of one of the most tumultuous growing seasons ever, with people nervously waiting to see if the U.S. corn and soybean harvests will be big enough to revive stocks that declined due to war and weather conditions, Bloomberg reports.

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A closely watched industry crop tour will try to find out this week, as dozens of growers, grain buyers and analysts take to the fields to see first-hand the state of plants used for feed, food and fuel. The scouts in particular will assess the impact of the scorching heat and lack of rain that have hit key parts of the Farm Belt in recent months.

The size of harvests in the US – the top producer of corn and the second-largest producer of soybeans – will determine prices for months until more is known about exports from the war-torn Black Sea hub and the outlook for South American crops that soon they will start to plant. So far, erratic weather conditions across the US have made the job of predicting the crop much more difficult. Yields are expected to be good, but not as high as the USDA predicts. With stocks low, crop size matters a lot.

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With Europe suffering from heatwaves and Argentina delaying planting due to drought, the size of the North American crop will determine global supplies well into next year. In a year plagued by runaway inflation, high volatility and food shortages, farmers are under immense pressure.

“There’s been so much heat and extremes this growing season that I don’t think the story is over in terms of potential yield declines,” said Kevin McNew, chief economist for the agricultural technology firm Farmer’s Business Network.

Like last year, the US Farm Belt is struggling with areas of severe drought west of the Mississippi River. The east side has also been affected, including top producing states like Iowa and Illinois, though not as extensively or severely.

Another aggravating factor is the excessive spring rains that have delayed planting throughout the Midwestern states, jeopardizing upcoming harvests. With market predictions all over the place, the only constant is: expect fluctuations.

The four-day Pro Farmer Midwest Crop Tour, which runs through Thursday, comes on the heels of new U.S. Department of Agriculture estimates calling for an average corn production.

Along with flooding in some areas that prompted some farmers to switch to other crops, such as soybeans, or leave fields vacant and file for insurance coverage, some producers held back acres this year due to record high fertilizer prices. . According to the USDA, this year’s soybean crop, which typically receives only a quarter of the fertilizer that corn receives, is the largest ever.

But late planting means both corn and soybeans are more vulnerable to late-season weather, including frost, that could reduce production.

“We are hearing dramatically mixed reports of the situation from farmers, which adds more difficulty to calculating yield estimates,” said Jacqueline Holland, an analyst at Farm Futures.

Soy in particular is at risk, as the crops used to make a wide range of food, as well as climate-friendly biofuels, are still at a critical stage of development. “With planting delays this spring, there is still time to make — or lose — a portion of the soybean crop within the next two weeks,” Holland said.

More severe drought in the western part of the corn belt has sent local grain prices soaring above Chicago futures, which have fallen about 20% in the past three months as Ukraine was able to shift exports from the Black Sea after months of blockade due to Russia’s attack on the world’s main supplier of grains and vegetable oils.

Overall, national corn and soybean production is not likely to be as large as the U.S. forecasts, according to Ben Buckner, Chicago-based AgResource grain analyst.

Crop yield potential remains “all over the place,” he said.

Source: Capital

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