How come the American MSM is not reporting on this story? Maybe it is because it doesn’t fit the storyline of deflation being peddled by Bernanke and his banker minions. The BLS will conclude that prices have actually dropped as people switched from corn to switch grass and from hamburger to 6 month old pink slime from landfills. Presto – prices aren’t really up 20% in a month. As the biggest exporter of corn and soybeans in the world, a continued devastating drought in the Midwest will not only drive up prices in our supermarkets, but it will cause unrest and revolution in 3rd world countries where 50% of their income is spent on food.

I sure hope this doesn’t raise the prices of grape soda, cheetos, twinkies, and KFC. The SNAP users in West Philly will not be happy. The combination of higher food prices, 100 degree weather, 70% teen unemployment, and guns should make it a pleasant summer on the 30 Blocks of Squalor. It might be time to install bullet proof windows.

Efarmer has already posted a warning about this drought. Any other front line info from our farmer readers is welcome. 


Heatwave threatens US grain harvest

By Gregory Meyer in New York

Canadian wheat harvesting PICN

An intense heatwave is threatening havoc with this year’s US grain harvest,  burning up hopes  of blockbuster yields and sending prices soaring.

Even a modest reduction in crops could  send ripples through global food commodities markets, as the US is the  world’s top exporter of corn, soyabeans and wheat, and stocks of the first two  are relatively low.

Soyabean prices have surged to the highest level since the 2007-08 food  crisis and the price of this year’s corn crop has risen 30 per cent since  mid-June. Worries about the size of the US crop come only months after drought  hit the Latin American soyabean belt of Brazil, Argentina, Uruguay and  Paraguay.

Top US farming states such as Illinois and Indiana had suffered temperatures  above 38ºC (100ºF) for several days already, with no let-up this week.

“The forecast is going to remain pretty much the same over the next week.  We’re not looking at much of a break in the heat,” said Matt Barnes,  meteorologist at the National Weather Service’s central Illinois office.

Soyabean futures on Monday rose 1.5 per cent in early trading to $15.42 a  bushel, the highest since July 2008. The oilseed price has surged 15 per cent  since the beginning of June as high temperatures blanketed farm fields. Corn  came within pennies of $7 a bushel for the first time since September.

“We aren’t seeing widespread failure yet, but it sure is developing rapidly,” said Brian Fuchs, climatologist at the National Drought Mitigation Centre.

The US Department of Agriculture on Monday said less than half of US corn was  in good or excellent condition while 22 per cent was in poor condition,  downgrading estimates from a week ago.

The shift in grain market sentiment caught traders and farmers off guard.  Lulled by an early and successful planting season, money managers, such as hedge  funds, one month ago had the smallest number of bullish bets on corn in two  years.

G4022X, Soyabean

The warmth that enabled farmers to plant seeds quickly has since escalated  into damaging extreme heat.

“The combination of low subsoil moisture, which is a reflection of the lack  of precipitation that we had during the winter, together with the very hot  weather that we’re seeing right now could spell a pretty disastrous scenario for  corn and soyabeans,” said Hussein Allidina, head of commodities research at  Morgan Stanley.

The outcome is critical to global food prices and the agribusiness industry  because the US supplies almost  half of global corn exports and a third of soyabean exports. Demand for both  has risen as consumers in emerging countries eat more meat.

The heatwave threatens to undermine forecasts of record output after the most  widespread US corn plantings in 75 years. The Agriculture Department said that  US farmers seeded 96.4m acres with corn this spring, 541,000 acres more than  they told government surveyors in early March.


  1. I lived in the heartland of Corn America, central Illinois, for a couple of years. All I remember is …. record heat and dry weather early in the summer, not good. Hot, dry August, good. Efarmer, where are you?

  2. The heatwave threatens to undermine forecasts of record output after the most widespread US corn plantings in 75 years.


    I hope they perfect space travel so I can sell tickets to bizarro world

  3. See? Those Nobel Prize winning assholes were right. All praise Al Gore! Meanwhile, George Carlin’s legacy speaks the truth-get the fuck over it, people. Sorry Colma-tortilla prices certain to rise.

  4. I’m in Northern Iowa.

    NECSI Food Price Update Warns of Crisis by 2013

    CAMBRIDGE (March 6)–According to a new study from the New England Complex Systems Institute the next food price bubble will occur by 2013.

    “The food price bubble of 2011 caused widespread hunger and helped trigger the Arab spring. In 2013 we expect prices to be even higher and may lead to major social disruptions.” said Professor Bar-Yam President of NECSI, who has just returned from Davos where he presented his findings on speculation in global commodity markets. His paper “The Food Crises: A Quantitative Model of Food Prices Including Speculators and Ethanol Conversion” was called by Wired magazine one of the top 10 discoveries in science of 2011.


  5. Heat, dryness slam crop conditions — USDA
    Jeff Caldwell
    07/02/2012 @ 3:20pm
    Multimedia Editor for Agriculture.com and Successful Farming magazine.

    The nation’s corn and soybean crops have taken a beating in the last week, according to Monday’s USDA Crop Progress report.
    The amount of that crop in good to excellent conditions went from 58% to 48% in the last week, Monday’s report shows. All that slide was taken up by the very poor and poor condition categories, with 7% of the crop in the former and 15% in the latter, USDA said Monday.
    Soybean conditions didn’t fare much better; in fact, that crop saw an 8% drop in the good & excellent categories over the previous week, too. As of Sunday, 45% of the crop’s in those top 2 categories versus 53% last week.


  6. I concur. I’m no farmer, but I’m surrounded by farmers. We’re in severe drought conditions here. That map pretty well says it all.

  7. This is all bullshit. Everybody knows this is caused by farmers who will not water their crops, thus creating a food shortage and higher food prices to get Obama out of the Whitehouse, because they are all racists. Eugene Robinson told me.

  8. My son asks how much longer will the current political excesses be allowed by the people. I tell him that riots will only start when people are hungry. Riots coming soon to a city near you. our corn (west central ohio) is starting to tassel now. Most of it is only about 3 feet tall (it should be more than 7 feet tall). It will not produce much if any yield this year. Our soybeans should be 3 to 4 feet tall, but in almost every field you can still see the ground. Another week or two like this will be the end of the beans too. If the hot and dry continues Food is going to become very expensive. For those who have never looked into it and are saying ‘Big deal, I eat beef and potatoes, not corn and tofu,’ here is what you need to know. Corn and beans, in some form, are in almost every product you use. The fuel in your car, the packaging on your food, cosmetics, hundreds of products that on the surface seem to have nothing to do with corn and beans are affected by the price of grains. Add in that agriculture is the USA’s biggest industry and you can see how a bad harvest is a looming disaster for this country and the whole world. If you haven’t already, now would be a good time to fill every spare corner with food. There have been quite a few articles lately pointing toward a troubled September. I think you can put food riots on that list too.

    Winter is coming.

  9. Dave L,

    I really look forward to the day we can sit down and suck a bottle of bourbon. Don’t die just yet, the fireworks are just beginning.


  10. GRAINS-Corn rally rages on as drought withers US crop

    Wed Jul 4, 2012 2:55am IST

    * December U.S. corn hits contract high
    * Spot-month soy trades to 4-year peak
    * Reuters poll shows expected drop in corn yield
    * Long-range forecast brings cooler weather

    By Rod Nickel and Sam Nelson
    WINNIPEG, Manitoba/CHICAGO, July 3 (Reuters) – Relentless
    heat in the key U.S. corn- and soybean-growing areas drove
    benchmark Chicago corn futures higher on Tuesday, marking the
    golden grain’s biggest eight-day advance in 3-1/2 years as
    drought brought worries about world grain supplies.
    Soybean prices jumped to their highest levels since 2008,
    less than a dollar per bushel off that year’s top, while U.S.
    wheat hit its highest price in over a year, tracking corn’s
    The hot, dry weather prompted analysts to reduce corn yield
    estimates, pointing to a smaller crop in the world’s No. 1
    grower than had been expected. In a Reuters poll Tuesday – the
    day after the U.S. Department of Agriculture (USDA) reported on
    crop conditions – analysts on average pegged the U.S. corn yield
    at 153.4 bushels per acre, down from 157.3 bushels a week ago.

    The USDA on Monday slashed its condition rating for U.S.
    corn to 48 percent good-to-excellent, down 8 percentage points
    from a week earlier. It pegged the soybean crop at 45 percent
    good-to-excellent, compared with 53 percent a week ago.

    The long-range forecast offered some mild relief as cooler
    weather is expected next week in the U.S. grain belt.
    “There’s something for the bulls and bears today, with the
    crop continuing to sink with the hot, dry conditions,” said Don
    Roose, president and analyst at U.S. Commodities in West Des
    Moines, Iowa. “The bears have something with a little bit of a
    possible change cooler in those way distant maps.”
    Chicago Board of Trade December corn gained 18-3/4
    U.S. cents, or 2.9 percent, to $6.74-1/2 a bushel, just slightly
    below its fresh contract high of $6.76.
    The benchmark December contract has gained 22.5 percent over
    the past eight trading sessions, the biggest corn advance in
    3-1/2 years for a like period compared with spot-contract prices
    on a continuous chart.
    December corn has gained ground in seven of those eight
    sessions, picking up momentum after the rally looked to lose
    steam last Thursday.

    The most active November soybean contract rose to a
    contract high of $14.78 a bushel, while the spot month
    reached the highest price since July 2008.
    Nearby July soybeans surged 40 cents, or 2.6 percent, to
    $15.72-1/4 per bushel.
    Moderate temperatures forecast for next week, accompanied by
    some rainfall in the south, will arrive too late to save some of
    the already-damaged corn crop, an agricultural meteorologist
    said on Tuesday.
    The chance for rain and cooler temperatures follows heat and
    dryness this week that is harming corn and soybean production
    prospects, said Don Keeney, meteorologist for MDA EarthSat
    “The six- to 10-day is wetter for the southern Midwest and
    Delta, not excessively wet, on the order of 0.50 inch to one
    inch of rain is possible,” he said.
    Midday weather updates on Tuesday showed little change.
    Rain amounts next week are expected to fall well short of
    rescuing most crops. Much of the damage is already done to corn,
    making a short position through Wednesday’s Independence Day
    holiday in the United States a risky gambit for some.
    “Before the market has a solid change, you’re going to see
    real evidence of (better weather) or a soaking rain,” Roose
    The latest corn rating is 29 percentage points below the
    USDA’s initial forecast early in the crop season and the soybean
    rating is 11 percentage points below the USDA’s initial
    Unlike corn, which is baking during its key pollination
    stage, soybeans do not reach their critical stage of pod-filling
    until August.
    Still, the soy crop’s potential for bouncing back is limited
    by the fact that only small amounts of rain are expected next
    week, said analyst Anne Frick of Jefferies Bache.
    “Beans are very drought-resistant and they can bounce back,
    but I don’t think anybody really expects them to bounce back to
    the USDA’s trend yield level,” she said.
    September wheat gained 26-3/4 cents, or 3.5 percent,
    to $7.99-1/4 a bushel, gaining spillover support from corn.
    On a continuation chart, front-month wheat climbed as
    high as $7.82 per bushel, its highest since June last year.
    New-crop Minneapolis spring wheat futures <0#MWE:> led the
    way higher for the wheat complex, with the December contract
    climbing 3.6 percent.
    The USDA on Monday estimated that 71 percent of the U.S.
    spring wheat crop was in good or excellent condition, a drop of
    six percentage points from the previous week.
    In Western Europe, the outlook for wheat crops has improved
    after June rains, but dry, sunny weather is now needed to avert
    harvest delays, yield losses and quality problems, crop analysts

    Prices at 12:29 p.m. CDT (1729 GMT)
    CBOT corn 718.75 26.25 3.8% 11.2%
    CBOT soy 1572.25 40.00 2.6% 31.2%
    CBOT meal 454.10 11.60 2.6% 46.8%
    CBOT soyoil 52.95 0.77 1.5% 1.7%
    CBOT wheat 782.25 27.75 3.7% 19.8%
    CBOT rice 1471.50 32.50 2.3% 0.8%
    EU wheat 236.00 4.00 1.7% 16.5%

    US crude 87.48 3.73 4.5% -11.5%
    Dow Jones 12,944 72 0.6% 5.9%
    Gold 1620.36 23.68 1.5% 3.6%
    Euro/dollar 1.2606 0.0025 0.2% -2.6%
    Dollar Index 81.8020 -0.0680 -0.1% 2.0%
    Baltic Freight 1063 50 4.9% -38.8%

    (Reporting by Rod Nickel in Winnipeg, Manitoba and Sam Nelson
    in Chicago; additional reporting by Naveen Thukral in Singapore
    and Svetlana Kovalyova in Milan; editing by Jeffrey Benkoe, Jim
    Marshall and David Gregorio)

  11. Russian wheat price reaches historic highs

    Published: 04 July, 2012, 13:47

    Prices for Russian fourth-grade milling wheat skyrocketed due to the drought in the US and Latin America.

    ­Prices rose to a historic 8900 roubles ($276) from 7075 ($219) a metric ton a week ago in the Black sea ports according to the Institute for Agricultural Market Studies (IKAR).

    This is the first price hike since the 2010 drought in Russia when the government was forced to impose an export embargo to prevent home market prices from rising. The embargo was lifted in 2011.

    Global wheat and maize prices also jumped nearly 30% mainly due to a drought in the United States and parts of Latin America. According to the US Department of Agriculture about 22 percent of the wheat crop has suffered and less than 50 percent remained intact.

    “Another reason for the price hike is the drought in parts of Rostov and Krasnodar regions in Southern Russia that forced the Agriculture Ministry to cut its 2012 harvest forecast to 86,5 million tons from an earlier estimate of 94 million tons”, said Dmitry Rylko, General Director of IKAR.

    Russia’s grain stocks fell to 16.8 million tons on June 1 from 22 million tons on May 1, according to the State Statistics Service data.

    Russia, the world’s second wheat exporter after the United States, plans to export between 13.5 million to 13.8 million tons of wheat for the season 2012-13. That’s compared with an estimated 21 million tons in 2011-12, according to IKAR.

    The main importers are Middle East and North African countries.

    Russia may even consider imposing another grain export ban if price rises continue.

    “I hope this doesn’t happen” says Dmitry Rylko. “It’s still too early to say. Things can change for the better.”

    Meanwhile exporters have slowed down their business, waiting for a wider margin between international and domestic prices.

  12. You can bet your “sweet corn” ass that if the corn supply declines by 10% some fucking assholes in Congress will push for an increase in ethanol content in gasoline by 20%.

  13. CavTanker,


    Mother Nature can be a cantankerous ol’ heifer.

    That should be at the top of the long list of reasons to stock up.

    All the money folks just burned up “celebrating” Independence Day could have been put to such better use.

    Oh, but I forget.

    They can’t afford it.

  14. OUCH!!!


    Corn up another 5% today

    Wheat up another 5% today

    Soybeans up another 4% today

    Lumber up 4%

    OJ up 3%

  15. As U.S. Corn Belt Bakes, Wheat Heats Up in Europe .


    LONDON—A change in the weather is enough to recreate the world, wrote Marcel Proust.

    Global grain markets are being transformed by extreme heat and dryness in a key U.S. growing region. Fields in the Midwest are baking under relentless sunshine, raising concern over crops in the country’s corn belt. Led by corn, grain prices have soared.

    In July, the bulk of the corn crop will pollinate, a critical phase of growth that leaves the plants highly sensitive to heat. If the weather worsens this month, as forecasts suggest, that could mean prices will rise further in the near term, according to Goldman Sachs. The bank said it could cut its yield estimate from the current 153.5 bushels per acre.

    The U.S. Department of Agriculture last week raised its estimate for the amount of land on which U.S. farmers planted corn this year to 96.4 million acres. Farmers planted 5% more acres of corn this year than last year, boosting the total to the highest level since 1937, the agency said.

    However, the USDA’s closely watched data on prospective corn yields is widely seen as being out of step with developments on the ground. “Historically it’s been pretty good, just not this year as these weather conditions have been unprecedented,” said Rabobank analyst Nick Higgins. “They will have to make an adjustment in this month’s report,” which is due on Monday.

    He said, though, that the USDA production-forecasting model relies, in part, on actual temperatures recorded, so its forecasts won’t reflect the anticipated July heat until the month ends. As a result, the next yield prediction “won’t get near to numbers that the market is talking about.”

    According to Joseph Vaclavik, president of Standard Grain Inc., land accounting for 75% of projected U.S. corn production is now excessively dry at the subsoil level, during the most important part of the growing season. “Agronomists and crop scouts now look for national corn yields near 150 bushels per acre versus the USDA’s current estimate of 166 bushels per acre,” Mr. Vaclavik said.

    Wheat is often used as a substitute for corn in feed and industrial use, and European wheat futures are now poised for more gains. Adding to the mix are expectations that production losses in Russia will cut into global wheat output this year.

    “The market was looking very well supplied with large acreage in Canada and Australia, but Russian production faltered just as the U.S. drought began to impact,” said Rabobank’s Mr. Higgins. “The real risk now is if spring wheat conditions in the U.S. turn down and the Russian losses worsen. The USDA is forecasting wheat production in Russia at 53 million tons, while a more reasonable estimate would be 46 to 48 million tons.”

    U.S. spring wheat is the crop now about to pollinate.

    The International Grains Council on Monday slashed its forecast for Russian wheat production for the year ending in June 2013 by six million tons to 49 million tons. The London-based body also cut its view on Ukraine’s harvest by one million tons to 13 million tons, and said less wheat will be available for export from the Black Sea region, forcing international buyers to find other sources.

    Another factor bolstering European wheat is the European Central Bank’s decision to drop its key lending rate to 0.75%, a record low, on Thursday, according to Jaime Nolan-Miralles, commodity-risk manager at FCStone Europe. The move should lead to a weaker euro, making wheat from euro-zone countries more competitive on the international market.

    European wheat futures have already rallied in recent weeks. Paris milling wheat futures for November delivery increased nearly 13% over eight consecutive sessions starting June 18. Thursday, November wheat closed at €243.75 ($305.35) per ton, up €6.25, or 2.6%.

    Abdolreza Abbassian, senior grains analyst at the United Nations’ Food and Agriculture Organization, said concern over the weather could make prices even more volatile than they have been recently, at least until prospects for production in the U.S. and former Soviet Union become clearer.

  16. Simple solution to the problem, TBPers……

    Buy MOO – the Ag ETF. One week after you purchase it, the rains will come, temperatures will cool, a bumper crop will be forecast and you loose 30% of your investment in short order!

    (By the way, I have BUYs on MOO and XLU (Utility ETF) with XLU having been in a buy since March of 2009. It’s still in a Bull market..

    (Disclosure: OLd Muck has positions in both!)


  17. Muck: I bought 600 shares of XLU in 2009. Thought about MOO also, but I also subscribe to the idea that any stock bought because of a weather crisis will be killed by a weather crisis of opposite proportion.

  18. Check out agweb.com and read the crop comment section. The corn crop in Pa. is also under stress, pastures are drying up, doesn’t look good here either.

  19. Haven’t been on TBP much for the past week; took time off to help carry water to our young trees, just trying to keep them alive. Our irrigation ponds are down 5-8 feet already, and that’s just trying to keep the trees alive. Most of our crop was wiped out by late frosts. Most everyone we know here in Michigan/Indiana/Ohio has only about a 20-40% crop this year.

    Traveled to the local Amish produce auction yesterday. Buyers with farm markets were paying $1.50/lb. for green beans and $2/each for green peppers. Sweet corn went for $4/doz for short ears. With those kind of wholesale prices, you can imagine what people will be paying retail.

    Everywhere here in Northern Indiana, farmers are chopping up their corn for silage. Tassled weeks ago at only about 2 feet. Only the seed growers are doing well, but then they have irrigation. Hay fields are brown and guys were lucky if they got more than one cutting.

  20. Thinker

    None of this is being reported by the MSM.

    YTD prices for Wheat, Soybeans and Corn are already up 20% to 30% and the MSM isn’t reporting a peep about it.

    I guess they think it would hurt their Savior Obama’s re-election chances.

  21. (off topic)


    Ah yes, the smell of the silage pit. I’ll never forget it. Just the word “silage” conjures up memories.

    My brothers and I went along for the ride many times when our parents would go get a load to feed to the dairy cows.

    Seems like yesterday…..

    I hope the weather turns for the better.

    Best of luck to you.


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