Weather Woes Cause American Corn Farmers To Throw In The Towel
File photo of a corn field in South Dakota. (Matt Gade / Forum News Service)
Written By: Washington Post
June 18th 2019
In the nation's 18 major corn-producing states, there has been one refrain for the past few weeks: To plant or not to plant? There comes a point of no return, where the cost of planting outweighs potential remuneration, where yields dwindle and there just may not be enough days for plants to mature before a hard frost.
For many American corn farmers, that point is now.
On Monday, June 17, the U.S. Department of Agriculture reported that domestic plantings were at 92% of farmers' total intended acreage, the slowest pace in more than 40 years.
Ohio trailed behind, with only 68% of its corn planted, South Dakota had 78%, and Michigan and Indiana each had 84% of their hoped-for acres planted. Last week, the USDA lowered the projected total yield to 13.68 billion bushels (last year's corn yield was 14.3 billion bushels). And as of Monday, in anticipation of an impending shortage, corn futures continued to trade at their highest level since June 2014.
According to the National Oceanic and Atmospheric Administration's National Centers for Environmental Information, May 2018 to April 2019 was the wettest year on record in the contiguous United States. Already-saturated ground got even more rain in May and into June, said Tyler Urban, 31, who sells crop insurance and farms corn and soybeans near Sioux Falls, South Dakota.
"I know 1993 was another wet year. I've asked the old-timers if this is worse and they're saying yes," he said.
Farmers deal with untenable planting conditions in a range of ways. Urban offers "prevented planting" crop insurance, where farmers who elect not to plant are reimbursed for a portion of what they would have grown (where he farms in southeast South Dakota, farmers are reimbursed 55% of what they would have made for their intended acreage of corn, 60% for would-be soy).
"In my insurance book, 100% of my farmers will have some sort of prevent-plant claim," Urban said. "This year, there are whole farms that haven't been planted. Right now, our ground conditions are finally starting to dry out, but it's too late."
Jonathan Kleinjan is an extension crops specialist, someone who educates farmers about scientific research in agriculture, at South Dakota State University. He describes the current situation as unprecedented. In the southeastern part of the state, he says only 30 to 40% of corn has been planted, with standing water hurting the likelihood of a decent outcome for acreage planted in May.
"The prevent-plant insurance will be enough money to keep you in business for a year unless you were in trouble already," he said. But farmers' decisions to forgo planting will have ramifications for many of the businesses that furnish farmers with equipment and supplies.
"The suppliers who sell seed and herbicides to farmers don't have insurance, so they might be at risk," Kleinjan said.
Erik Gerlach, South Dakota's state statistician, describes other factors affecting farmers: low prices for corn and soybeans, tariffs and uncertainty surrounding disaster and trade relief packages.
In May, President Donald Trump announced a $16 billion bailout for farmers hurt by his trade war with China. Agriculture Secretary Sonny Perdue initially stated that the money would be available only for planted acreage, not acreage forestalled by protracted bad weather. But on June 10, Perdue announced that the administration was "exploring legal flexibilities to provide a minimal per acre market facilitation payment to folks who filed prevent plant and chose to plant an . . . eligible cover crop, with the potential to be harvested and for subsequent use of those cover crops for forage."
On June 6, Trump signed the supplemental appropriations bill that includes disaster aid for farmers and has a provision that would allow payments to farmers for prevented planting. Because details for both the disaster and trade relief packages remain scant, farmers are frequently unsure of which course to chart.
"Each producer's operation in unique to them," Gerlach said. "There are a lot of variables: What's your proven yield, what further costs would you have to expend to plant? In some cases, farmers might plant because they have cattle or hogs to feed."
In northwest Ohio, dairy farmers are likely to keep planting corn until July 1, despite diminishing yields, said Eric Richer, an Ohio State University extension educator in Fulton County. Corn is a desirable crop to feed lactating cows and growing beef cattle. And because the plants don't need to reach full maturity to become corn silage for animal feed, there's a little more wiggle room. Still, Richer said his state's dairy industry, already hard-hit by high farm costs and low sales prices resulting from a milk surplus, will be most affected.
"The level of financial, emotional and mental stress on farmers is significant as a result of late planting in 2019. The spring of 2019 is like no other I've seen in my career," he said. "The new normal for farmers is weather extremes, and that's difficult to manage."
Since 2012, Sam Custer has been an extension educator for Agriculture and Natural Resources in Darke County, Ohio, which produces much of the state's corn and soybeans. Although yields have been strong for the past three or four years, he said it has been a difficult time, with net farm incomes trending downward since 2013. He said that corn and soy already planted this year were planted under poor conditions and that most people anticipate a poor yield.
"As I talked with agricultural lenders last week, they were becoming very concerned there will be some people this fall who will be very financially strapped, they're worried about mental health issues," he said.
Tim Palmer farms 1,000 acres in south-central Iowa, where the majority of corn and soybean acres are typically planted by May 25.
"I have an aversion to seeing acres going unplanted. But we had one of the coolest and rainiest Mays on record, and that's not conducive to healthy corn and soybean planting," he said.
He has planted corn in June several times, he said, but it's a tough decision because a bad yield is averaged into 10-year harvest numbers and negatively affects crop insurance guarantees in the future. He finished planting all the corn he was going to plant last week and is working to get all his soybeans in the ground.
"I've just got a little bit left," he said Monday morning. "I was out there 12 hours a day from Friday to Sunday, planted about 250 acres. I'd take a break for a sandwich. Now it's fertilize, spray and hope Mother Nature takes care of the rest of it."
This is article was written by Laura Reiley, a reporter for The Washington Post.
Related Topics
AGWEEK | AGRICULTURE CORN | USDA FARMING | SOUTH DAKOTA | NORTH DAKOTA