Drought news: USDA predicts corn crop crash, while prices soar

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From CNN (Aaron Smith):

In its monthly World Agricultural Supply and Demand report, the USDA projected the corn harvest would plunge by 2.2 billion bushels, or by 22.6 bushels per acre, resulting in a harvest of 123.4 acres per acre. That’s worse than expected and puts the 2012-2013 yield on track to be the lowest since the 1995-1996 harvest…

Meanwhile, the USDA also said it now expects farm prices for corn to hit a record high this season of $7.50 to $8.90 per bushel, sharply higher than its July forecast of $5.40 to $6.40 per bushel. The USDA blamed “extreme and dryness” in the Central Plains and the Corn Belt…

Fewer crops has translated into higher prices for consumers. On Thursday, the United Nations released a report that showed world food prices jumped 6% in July.
Corn was the biggest culprit for the price hike. The global price of corn surged nearly 23% last month…

The drought is also taking a toll on soybeans, which are essential to oil products such as cooking oil, margarine and peanut butter. The USDA dropped its yield forecast to 36.1 bushels per acre. That’s 4.4 bushels lower than last month’s estimate, and 5.4 bushels below last year’s yield. The USDA said that soybean prices surged to record levels, up $2 to a range of $15 to $17 per bushel.

I think the U.S. Drought Monitor computer was so depressed it committed suicide today. I’m lucky I had the drought map from last week, I can’t get the latest one this afternoon.

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