Thursday, March 28, 2013

The bill for the 2012 corn belt drought disaster

This winter we got some snow here in SE Minnesota but most of that will just help fill the rivers—very little will go into the ground.  So unless there are some serious spring rains, the ground will start the growing season seriously in moisture debt.  Prices for supplies are at record high so farmers have to spend a lot of money planting.  Takes a lot of courage to farm if the rains won't come.  At least folks around here got a crop last year—you don't have to go very far to find farmers who did not.

The 2012 Drought Could Become Second Most Expensive Natural Disaster In History

Rob Wile | Mar. 12, 2013

We spent most of last summer documenting the incredible drought ravaging America's heartland.

It was too soon to know just how bad it was going to be, since the harvest would come a few months later.

The Illinois' Department of Employment Security has now weighed in, and they make a pretty extreme call:

The twin effects of surging costs and lost income for farmers could make the drought the second most expensive natural disaster in history, after Hurricane Katrina.

Here's how they reckon it:

Crop farmers not only had a terrible 2012 harvest but now find their soil fried for this year. Drought-resistant seeds are more expensive, the study notes.

The poor harvest sent prices skyrocketing. Between 2012 and 2013, food prices are expected to rise up to 4 percent.

Livestock farmers were probably the hardest hit, since most crops end up as feed, followed by ethanol and biodiesel fuel refiners.

And many livestock workers will probably lose their jobs, the study notes:
With corn and bean prices high, livestock producer margins will decline the more that those prices rise. More livestock will be slaughtered if feed is priced high or feed is not available. So short-term meat industry employment is expected to increase, but it is expected to decrease in the longer term.
And the inflation will not only be felt in the U.S., but in many emerging economies who depend on importing American food.

The price increases could thus force labor costs in those countries' importing sectors higher. That — and possible panic buying — could in turn lead to costly political instability there.

Finally, low water levels may impact tourism and recreation along the Midwest's waterways,as well as stifle commercial barge traffic. The drought has caused the Mississippi River level to be at its lowest level in decades.

The report's author, Dr. Dave Bieneman, doesn't put a total dollar figure on the disaster.

But it's pretty clear this was a total wipeout, even if wasn't overnight.  more
Some "disasters" are less important than others.

Drought Limits Corn Cob Pipe Comeback

by RACHEL LIPPMANN  March 26, 2013

The Missouri Meerschaum factory in Washington, Mo., is the only place in the world that manufactures corn cob pipes made famous by such historical figures as Mark Twain and General Douglas MacArthur. Sales at the company have grown over the last two years, but that number could have been higher if not for last year's drought.

Amazing but true, Popeye and Frosty the Snowman have something in common with General Douglas MacArthur and Mark Twain. They're all known for smoking a corn cob pipe. Corn cob pipes have made a comeback in recent years, welcomed news for the last company in the U.S. mass producing them. It's located in Washington, Missouri, about an hour west of St. Louis.

Still, as St. Louis Public Radio's Rachel Lippmann reports, last summer's brutal heat and drought have been a big challenge.

RACHEL LIPPMANN, BYLINE: Walk into the sprawling brick building that houses the Missouri Meerschaum Company, and you get the sense that not much has changed since the 1880s. Sure, there's electricity now and running water. But when it comes to making the pipes that made the company famous, the process is pretty much the same. And that's just how general manager Phil Morgan likes it.

PHIL MORGAN: We like the heritage nature, the authentic nature of our pipe. You know, we like the - it's a natural product.

LIPPMANN: So this buzzing sound emanating from the second floor of his 133-year-old factory makes him cringe.

MORGAN: And I'd love for this - for it to be dead quiet up here. And the only thing to hear, a few squirrels running around.

LIPPMANN: Mounds of cobs are scattered across the wood floor of this unheated space, waiting to be cut into pieces, shaped into pipes of all sizes, coated in plaster, and shipped all over the world. In an ideal situation, this room would be full of cobs and they would sit for two years, drying naturally. So corn grown in 2012 wouldn't become pipes until 2014.

But the buzzing from the propane heater is helping these cobs dry more quickly. Though the weather was fine in 2010 and 2011, the cobs that grew were of poor quality. Morgan needed a good 2012 growing season to replenish his company's supply.

MORGAN: We had the seed we needed. But it was really warm in the spring, planted it early, the corn looked fantastic, and then the drought hit. Our field is irrigated so it wasn't just the drought, it was the heat. Corn does not like heat.

LIPPMANN: That 2012 crop produced just a third of the cobs needed. With inventory already low, there wasn't time for them to dry naturally. So that means firing up the propane. In addition, Morgan had to temporarily stop offering bigger pipes. And total sales, which had been rising in recent years, dropped.  more

No comments:

Post a Comment