Hopes for robust corn crop mount after last year’s drought
Source: Amanda Peterka, E&E reporter • Posted: Wednesday, February 13, 2013
Projections released by analysts over the past few days are so far optimistic, predicting a record number of acres to be planted and harvested, despite lingering dry conditions.
But at the beginning of last year, analysts also predicted a bumper crop — and then watched their projections fall as the weather turned warm and stayed dry throughout the summer.
“The reality is, with normal weather, we can outproduce the market easily. There’s no question about that,” Rick Tolman, CEO of the National Corn Growers Association, said at a renewable fuels industry conference last week in Las Vegas. “And whether it’s this year or next year, we will be back to surplus positions again with corn production. The reality is, we need to get back there now.”
The good news for corn farmers, Tolman said, is that the eastern Corn Belt is in a much better state than it was last year. Some parts of the belt, in fact, can be considered out of drought conditions.
But conditions in Nebraska, Kansas, Colorado and other states in the western Corn Belt are worse and will be the places to watch going forward, Tolman said. About half the country still remains in drought conditions, according to the U.S. Drought Monitor.
“If you look at the projected winter precipitation chart, there’s not a lot of optimism there,” Tolman said.
Yet analysts are projecting record numbers for the coming year. In a report released last week, the Congressional Budget Office predicted that corn farmers will plant 97 million acres of crops, up from the 96.9 million estimated to have been planted last year. Farmers will harvest a record 89.5 million of those acres this year, according to CBO.
The federal agency also predicted a record yield of 161.5 bushels per acre for a total of 14.5 billion bushels across the country. With the drought, last year’s yield was 122.3 bushels per acre for a total crop of 10.7 billion bushels.
Other private analysts are predicting up to 99 million acres planted this year with corn crops topping the 1.6 billion mark.
On Friday, the Department of Agriculture raised its projections of current corn stockpiles and lowered its expected average price for last year’s corn crop about 20 cents to between $6.75 and $7.65 a bushel. If the optimistic projections hold true for this coming year, the price of corn will likely fall back to the $5 range, and the country will see a rebound in exports, Tolman said.
Growing a large corn crop next year is vital for both the agriculture sector and the ethanol industry, which has shuttered a few dozen plants across the country due to the drought, he said.
“We need to get back to a position of strength and being able to have the supplies and stocks and productive capability available and focused to the consumers we’ve had in the past,” Tolman said.
Agriculture Secretary Tom Vilsack last week also expressed confidence in this year’s corn crop, even with the current dry soil conditions.
“Everyone who is involved in farming should always be optimistic at the beginning of the year,” he told reporters after a speech at the renewable fuels conference.
Vilsack said he hopes to see more cooperation from Mother Nature this year, but he also warned that climate change would take a toll on crop production and forestry. There will be a range of impacts from more intense and frequent storms and weather conditions, he said, referring to two comprehensive climate change reports USDA released last week (ClimateWire, Feb. 6).
“The drought is a wake-up call, and I think it’s good that we had this wake-up call,” Vilsack said, “and we’re just going to keep our fingers crossed that we have a little more rain than we had last year.”