The knock-on effects of the June of 2008 Upper Mississippi River basin floods will include meat prices being driven up much farther than could have been accomplished only by government incentives for corn-based ethanol. It's too late to replant completely inundated acres and the wet soils that still have living corn may need a reapplication of expensive nitrogen fertilizers. Futures market traders are in a tizzy.
The floods engulfed an estimated 2 million or more acres of corn and soybean fields in Iowa, Indiana, Illinois and other key growing states, sending world grain prices skyward on fears of a substantially smaller corn crop. The government will give a partial idea of how many corn acres were lost before the end of the month, but experts say the trickle-down effect could be more dramatic later this year, affecting everything from Thanksgiving turkeys to Christmas hams.A political promise of chicken in every pot won't sound so good this fall. Nor will taxpayer investment in corn-based ethanol. Senator Obama may need to rethink his pro-ethanol fuels platform.
There are credible people in the trade who think corn will be $2 higher in a month. It could happen. That would put beans up to $20. It could happen. Anything can happen," said Rich Feltes, senior vice president and director of MF Global Research.Getting beyond meat, have you checked out the price of corn or soy oil in the grocery store lately? It's getting closer to olive oil. Deep fried fast food too will go up in price.
These floods are not a freak event, as indicated by a plot of historic US Army Corps of Engineers flood flow data, gathered at the Mississippi River, in Hannibal Missouri.
Agricultural experts have noticed a tendency of increased flooding in the nation's most productive farm lands.
The Midwest receives about 10 percent more annual precipitation since 1980 than was received before 1970. This increase has effectively doubled the annual stream flow in much of the region. Accordingly rivers are more often over their banks. In the 40 years up to 1970 there were two "high" water years. In the subsequent 40 years there were 12.Like petroleum oil, meat is going to go up and stay up in price. In the Midwest, competition will increase for access to level farm land, with less propensity for flooding. This will be the same land developers want, on the upland side of river towns and cities.
Accordingly, an event that might have been expected once every 200 years in the past would be expected every 33 years or so under current climate conditions. Rivers and streams across the western Corn Belt have responded to the changing climate.
What will be best to grow on those alluvial ag lands that now seem to flood too often for corn? Switch grass maybe? Or hay. Or, perhaps, bottom land forest species adapted to repeated inundation.
Via::AP, AND The Mirror, AND ICM News Image credit::Purdue News, flooded corn field AND Upper Mississippi River System Flow Frequency, Study, USAE, Flood Flows At Hannibal MO