Prolonged Midwestern Drought Likely to Lead to Higher Grain and Soybean Prices
Date Posted: February 13, 2013
Coeur d'Alene, ID—Harris-Mann Climatology’s long-term forecaster, Climatologist Cliff Harris, predicts a continuation of the major drought in the central U.S., which is likely to lead to even higher grain and soybean prices later this year. His forecasts are based upon a discovered 80-year drought cycle across the nation’s midsection.
The persistent drought in this part of the country has also taken a huge toll on producers of ethanol.
The available corn is so short that nearly two dozen ethanol plants have been forced to halt production.
These ethanol plants will not reopen until after the 2013 corn crop is harvested this fall.
If this drought lingers through the 2013 crop season, corn prices could soar well above $8-a-bushel and soybeans to $16-a-bushel or more.
This would also mean higher food prices at local grocery stores.
According to Harris, “Major solar-induced drought patterns, often lasting nearly a full decade, have recurred across the midsection of the U.S. approximately every 80 years since at least the early 1600s.
"We are still in the latest version of this particular long-term drought cycle.
"There has been some moisture relief in parts of Texas and the eastern Corn Belt in recent weeks, but the western Midwest and much of the Great Plains remain in the firm grip of choking drought with no significant precipitation yet in sight west of the Mississippi River.”
The latest Palmer Drought Index, released by the National Weather Service, shows that much of eastern Montana, all of Wyoming, most of Nebraska and large parts of the Dakotas, Minnesota, Iowa, Colorado, Kansas, Missouri and New Mexico were still under "long-term extreme drought conditions."
“Sea-surface temperatures in the south-central Pacific Ocean are continuing to cool, which may result in a new La Nina by the spring season.
"A new La Nina often leads to drier and warmer than normal weather east of the Rockies during the spring and summer seasons, as was the case in 2012,” says Meteorologist Randy Mann.
Harris and Mann do not see a major break in the prolonged drought in the nation’s heartland for at least another 60 days, maybe longer.
According to Harris, “it will take months of above normal moisture in order for these parched regions to even begin to recover from years of extreme dryness. The last 80-year drought occurred in the Dust Bowl Era of 1930s. This was one of the worst environmental disasters of the entire 20th Century anywhere in the world.”
There was also another period of dryness in the central U.S. from 1856 to 1865. That drought peaked during the Civil War and was part of the 80-year drought cycle.
Harris-Mann Climatology points out that the continued dryness will likely lead to even higher grain and soybean prices later this year.
None of the areas effected by drought are expected to see any significant relief anytime soon, especially with colder ocean temperatures near the Equator.
Harris-Mann Climatology also has a daily advisory service that specializes in providing state of the art short and long-range weather analysis plus fundamental and technical mathematical stock and commodity forecasts.
Many investors depend on this service to track grain, soybean and other commodity futures both mathematically and fundamentally.
The company also provides free detailed monthly temperature and precipitation forecasts for most U.S. and world cities on their website at http://www.LongRangeWeather.com.
“We’re still in a pattern of wild weather ‘extremes,’ the worst in more than 1,000 years, since the days of Leif Ericsson,” says Harris.
For more information, call 866-283-0594.