The corn in Minnesota still looks pretty good. But is has been 19 days without rain and those lush fields could dry up just in time for pollination. Oof!
India's Monsoon Season Is Starting To Look Like A DisasterGus Lubin | Jul. 9, 2012
India's monsoon is 30 percent behind average and analysts are getting worried.
Jefferies' Arya Sen warns that a sub-par monsoon could add to growth and inflation concerns:
With FY13 GDP growth forecasts for India already at 5-6.5% for most on the street, a poor monsoon and its direct and indirect impacts could pose further risk to GDP growth. In the last decade, in the poor monsoon years of FY03 (-19%), FY05 (-14%) and FY10 (-22%), agricultural GDP growth has been -6.6%, 0.2% and 1.0% respectively against median growth of 3.5%. In FY12 agriculture contributed 14% to India's overall real GDP. The indirect impact could take various forms such as weaker rural demand and lower hydroelectric power production. A poor monsoon could also further drive up India's already high food and overall inflation with implications for RBI's decision making. Food items account for 24% in the WPI basket.
At least India's grain reserves may be high enough to avoid a food crisis, Sen says.
India has already been described as the weakest BRIC.
The monsoon—aka the real finance minister of India—lasts from mid-May to late-October, and it can recover from a bad June, but it is unlikely to recover from a bad July, Sen says. Better watch those weather maps. more
No rain is farmers' painMIKE HUGHLETT, Star Tribune July 9, 2012
A once-promising forecast is turning ugly for U.S. farmers, although Minnesota's crop is in better shape than most.
The corn is tall and still a lustrous green through much of Minnesota. But it's not going to stay that way for long without a good soaking rain -- pronto.
Already, Minnesota corn farmers are seeing wilting leaves and other signs of heat stress, though nothing like the drought that has stunted crops through much of the Corn Belt.
"Most states would trade places with us in a heartbeat," said Michael Swanson, an agricultural economist at Wells Fargo. "We've got it good right now compared to most of them."
Indeed, 77 percent of Minnesota's corn crop was in good to excellent condition for the week ending Sunday, the best of any state, according to Department of Agriculture data released Monday.
"The potential is there for a real good crop," said Chad Willis, who farms corn and soybeans east of Willmar. "But that dwindles every day that it doesn't rain."
The National Weather Service's forecast is not what farmers like Willis want to see: no appreciable rain through at least Friday, and temperatures climbing as the week goes on -- a potential double whammy.
Lured by high corn prices, farmers this spring sowed what's believed to be the biggest U.S. corn crop since 1937. But a heat wave across the Midwest has parched Illinois, Indiana, eastern Iowa and other key corn-growing areas. When July started, U.S. corn crops were in their worst shape since 1988.
"The stage was set for one of the biggest crops in the U.S. ever, and now it is pretty apparent that is not going to happen," said Douglas Tiffany, an assistant extension professor and renewable energy economist at the University of Minnesota. more