Corn grows on a flood damaged farm field near Colfax, Iowa. (AP Photo/Charlie Neibergall)
By Stephen J. Hedges
New federal grain production estimates released Monday are certain to stir more debate over the use of corn and soybeans for food or fuel.
Despite wash-out flooding in the Midwest, corn will remain king among crops in 2008, according to harvest forecasts released by the U.S. Department of Agriculture Monday. Fueled by high prices and increased demand due to ethanol production, U.S. farmers planted more than 87.3 million acres of corn this spring, down from a record 93.6 million in 2007, the USDA found.
That 2008 figure is higher than USDA predicted as recently as March. Corn prices declined slightly with Monday's higher production estimate.
Flooding will cut the number of acres actually harvested down to about 79 million, USDA said. But the department states that it will conduct follow-up interviews with 9,000 farmers in grain states affected by flooding -- Illinois, Iowa, Indiana, Wisconsin and Missouri - before it completes a harvest report due out Aug. 12.
Even after the flooding, USDA stated, the amount of corn acres planted is the second largest since 1946.
The soybean harvest is also expected to be large. Farmers have planted 74.5 million acres of soybeans, the third largest amount on record, "and up 17 percent from last year," according to USDA.
Both corn and soybean prices have been running high due to increased demand from the biofuels industry and increased exports prompted by a weak dollar.
Futures contracts for corn have traded from $7- to-$8-a-bushel in recent days, compared to prices of about $2.25-a-bushel just a few years ago. Soybeans prices have
also jumped to more than $15-a-bushel, compared to about $8-a-bushel just a year ago.
Cattle ranchers and dairy farmers, among others, complain that the corn-based feed they use has become too costy, driving up food costs. Many of them blame those higher prices on ethanol production, which distills fuel from corn. Congress and the Bush administration have enthusiastically backed ethanol, and biodiesel made from soybeans, as altenatives to gasoline.
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