For many, a small harvest is expected

9/15/2001

Steve Painter has just started harvesting soybeans on his family's Fostoria area farm, but what he has seen so far is only half the yield he usually gets.

“I just hope this first 100 acres isn't the indication for the whole crop,” he said.

Harvest of corn and soybeans - the area's largest crops - is expected to begin in earnest next week and yield less than usual across the region. Across the country, the corn crop is expected to be the lowest in four years, but the government is predicting a record soybean crop.

The spring had started perfectly. Mr. Painter and his two partners planted their 1,800 acres of corn and soybeans in two weeks flat.

But conditions quickly turned poor.

The month of May was so wet and cool that 150 acres of soybeans needed to be replanted - more than Mr. Painter had planted twice in 26 years of farming. Soybeans that rotted or drowned out were especially worrisome to farmers this year because prices were so low that the costs of replanting appeared to eliminate potential profits.

What followed was nearly the worst case scenario. The shallow-rooted plants that had survived wet conditions then struggled through weeks without a drenching shower.

By late July, when corn was reproducing - a crucial stage that determines yield, the soil was far too dry and temperatures too hot. The Painters haven't started harvesting corn yet, but Mr. Painter has pulled the husks back on a few plants and found only half an ear.

Even considering near-record government assistance for corn and soybean farmers this year, Mr. Painter said it is shaping up to be one of his worst years. And that's without knowing what repercussions from last week's terrorist strikes might do to prices for farm commodities that depend on export markets.

The story is the same for many farmers in southeast Michigan, where Governor John Engler has requested a disaster declaration, and in scattered sections in the heart of northwest Ohio.

On the fringe of the area, however, there are some very good crops. To the south, Hardin County agricultural extension agent Gene McCluer predicted an average crop, buoyed up by top yields in the southern portion of the county.

“I know the further north you go the uglier it gets,” he said.

To the east, Huron County agriculture agent Ted Gastier reported much better crops in the eastern portion of the county than in the northwestern part.

“I don't think this compares to the droughts of '88 or '91,” he said. “It was more uniform across the county those two years.”

In Monroe County, however, the Michigan Farm Bureau reported conditions were worse than the 1988 drought - which is considered the local benchmark for dryness.

At The Andersons, Inc., the area's largest local grain buyer, Hal Reed, general manager of the grain division, predicted corn and soybeans will average yields of 10 percent below normal in a 100-mile radius of Toledo.

That will hurt the Maumee-based company, which makes money based on the number of bushels it handles, more next year than this year, he said. The elevators still have much space devoted to wheat and they will be busy this fall accepting corn and soybeans straight out of the field. But next summer, he expects the grain wholesaler to receive less grain stored on farms over winter.

At Blanchard Valley Farmers Co-Op, Inc., which operates at nine locations in Hancock County, grain manager Andy Swerlein said he's expecting 20 percent less corn than last year and 15 percent less than average. He expects 5 percent less soybeans than last year - even though he thinks yields are down by 10 percent - because more beans were planted this year in response to more favorable government subsidies for the crop.

Whether farmers make money this year will depend not only on how many bushels they harvest but how adept and lucky they are at marketing and getting the best advantage from government programs.

Most full-time area corn and soybean farmers have received tens of thousands of dollars in government aid in each of the past few years. It is only because of those payments, however, that many will make money this year.

“If they would have had a year like this without the government programs, it would have been catastrophic,” said Gary Wilson, agricultural extension agent in Hancock County. “There's no way they would have been able to repay their loans. We have some farmers who will borrow their net worth every year. It costs a lot of money to put out a crop.”

He predicted corn yields in his county might average as much as 20 percent off of usual and soybeans might be down 25 percent, making it the poorest year since 1996, when his area had lots of problems with crop pests.

Elsewhere in the corn belt, the outlook for farmers is brighter, which has allowed prices to stay low.

While only 2 percent of the corn in Michigan and 12 percent in Ohio was rated excellent in the last National Agricultural Statistics Service report, more than 30 percent of the crop was deemed excellent in North Carolina, Kentucky, and Tennessee. Michigan had the poorest crop condition report of any of the 18 states that together produce more than 90 percent of the nation's corn.

In Ohio, less than half as much corn was rated excellent as last year and more than twice as much was called poor or very poor. In the heart of the corn belt, Indiana appears to have the best outlook with 19 percent of the crop rated excellent and 54 percent rated good.

Across the country, farmers are expected to harvest 9.24 billion bushels of corn, down 7 percent from last year and the lowest production since 1997's 9.21 billion, the U.S. Department of Agriculture said Friday in its monthly reports on U.S. crop conditions and world commodity supplies. The projected yield of 133.5 bushels per acre also would be the lowest in four years.

The soybean harvest is expected to reach a record 2.83 billion bushels, 2 percent over last year's record and 1 percent below last month's estimate. Yields are expected to average 38.2 bushels per acre, slightly higher than last year.

The department does not expect large changes in the prices of either commodity. The projected price was raised 5 cents for both crops to an average $2.15 per bushel for corn; $4.90 for soybeans.

Although the mediocre U.S. corn crop won't add to world supplies as much as some years, demand is down as well for both corn and soybeans, said Dale Gustafson, grain and oilseed analyst at Salomon Smith Barney in Chicago.

If U.S. grain supplies include traces of varieties not approved for human consumption - though they are not known to be dangerous - export demand could be reduced further.

As is often the case, one of the biggest wild cards is China, where crop production and demand is hard to gauge. Mr. Gustafson predicts that the country will be net exporter this year, which would help weigh down world prices.