Withering Corn Crop Feeds Global Concerns

July 10, 2012 11:42 PM

Corn futures have soared, crop condition ratings have dropped, and the world is hearing about risks of U.S. drought driving food prices higher.

Voice of America warned yesterday that world food prices likely will spike for the third time in five years, noting that price surges in 2007-08 and 2010-11 "triggered riots and social instability in dozens of countries around the world."

The Sydney Morning Telegraph said Australian consumers can expect to pay more for many foods in response to Midwestern U.S. crop damage and reported "demand for Australian grain is surging, pushing the price up for local users too."

And in Europe, analysts at Offre & Demande Agricole said deteriorating prospects for U.S. corn plus reduced Black Sea grain production have driven up prices ahead of the July 11 USDA reports on supply and demand, and may keep pushing prices higher.

December Chicago Board of Trade corn futures yesterday surged 37 cents to settle at $7.30, up nearly $1 in a week. The July contract climbed 32 cents to $7.75 ¼, up more than $1 in a week.

Yesterday afternoon, USDA rated only 40% of the corn crop in the 18 major corn-producing states in good to excellent condition, down from 48% the previous week, In those 18 states, 30% of the crop rated poor to very poor, compared with 22% the previous week.

Sixty percent or more of the crop rated poor to very poor in Indiana, Kentucky, Missouri, and Tennessee.

'Average Year' in Minnesota

Even in Minnesota, where 77% of the crop rated good to excellent this week, University of Minnesota Agronomist Jeff Coulter took a cautious view of the crop.

"It looks okay," said Coulter of the state's corn crop. "I think it's going to be an average year."

Tassels started to appear last week on early-planted corn.

"Last week we had really hot temperatures," said Coulter. "I don't think it affected pollination too much on early-planted corn. That corn has a pretty good root system."

This week, most corn is pollinating across Minnesota and temperatures are favorable, in the mid- to upper 80s.

"But the problem is we haven’t had rain for a while," said Coulter. "And the 10-day forecast shows nothing for basically the whole state."

Coulter expects successful pollination in Minnesota. "But we will have a lot of kernel abortion," he added.

Ratings Drop In Billion-Bushel States

Here's how conditions looked at the beginning of this week in the four states that produced more than 1 billion bushels of corn last year, and accounted for 57% of the U.S. corn crop:

Iowa, which produced nearly one-fifth of the 2011 crop, reported 48% of its corn silking as of July 8, up from 16% the prior week and the five-year average 7%. Also in Iowa as of July 8:

  • Tassels were out on 62% of the corn, up from 3% last year and the average 16%.
  • Only 46% of the crop rated good to excellent, down from 62% last week and the lowest good to excellent rating for the first week of July since 1993.
  • Poor to very poor ratings rose to 18% from last week's 10%.
  • State climatologist Harry Hillaker reported rainfall in the state last week averaged 0.02 inch, down from the normal 1.07 inches. "This was Iowa's driest week in 21 weeks," noted Hillaker.


Illinois reported only 19% of its corn crop in good to excellent condition, down from 26% last week. The state produced 16% of the 2011 U.S. crop. More on Illinois corn as of July 8:

  • Poor to very poor ratings covered 48% of the crop, compared with 33% last week.
  • Silking had reached 77% of the corn crop, up from 22% last year and the average 33%.
  • Illinois' temperatures averaged 86.4 degrees last week, 10.9 degrees higher than normal, and rainfall averaged 0.22 inches, which was 0.63 inches below normal.
  • Topsoil moisture is 96% short to very short and subsoil moisture is 93% short to very short.


Nebraska, which grew 12% of last year's corn, reported relatively better conditions even though ratings fell because of limited precipitation and triple-digit temperatures. Here are the numbers as of July 8:

  • Ratings were 47% good to excellent, down from 56% last week.
  • Poor to very poor ratings reached 20% of the crop, up from 15% last week.
  • Irrigated corn rated 65% good to excellent while dryland corn rated 22% good to excellent. About 60% of Nebraska's corn is irrigated.
  • Half the state's corn was silking, up from 6% last year and the average 14%.
  • Moisture ratings were short to very short for 86% of topsoil and 84% of subsoil.


Minnesota has had relatively few abnormally dry to drought areas on the Drought Monitor, but dryness has been creeping into the state from the south and west. Last year, the state produced nearly 10% of U.S. corn. As of July 8 in Minnesota:

  • Corn rated 77% good to excellent, down from 82% last week.
  • Only 5% of the crop rated poor to very poor, following 4% last week.
  • Forty-one percent of the crop had silked, compared with none last year and the average 8%.
  • Topsoil moisture rated 60% adequate to surplus, down from 78% on July 1.


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