US Farm Economy Flowing in Reverse as Drought Impacts Persist

The shipments come as the U.S. faces a 17-year low in corn supplies by the  end of the month due to the historic drought, which slashed harvests and sent  grain prices to record highs a year ago.

The tight supply is upending the country’s tradition-bound agricultural  economy, which is holding its breath in the weeks before an expected record  harvest begins some time next month following a wet spring and summer.

Grain, which typically flows south on the river to export markets, is heading  north from states like Louisiana and Arkansas, where farmers begin harvesting  earlier than their Midwestern counterparts. Normally, much of that grain would  ship overseas, but after prices climbed following the drought, exports are set  to drop to a 41-year low.

Ocean-going vessels are reversing course too, with record U.S. grain imports  expected from countries like Brazil and Canada as U.S. processors like Ingredion  and Pilgrim’s Pride seek cheaper corn.

“What’s really changing here is the flow of corn,” said Brent Baker, a vice  president for John Stewart & Associates, a trading firm. “This is  unprecedented.”

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