Pre-season surveys found U.S. farmers planning to plant as much as 30 percent less corn than last year, but farmers changed their minds when they saw how much of a shortfall was coming. More recent surveys show plans to plant 5 to 10 percent less corn.
The fact that we are still talking about plans to plant corn is not a good sign, however. While some farmers have managed to plant their cornfields, others are just getting started because of the persistent rains across the corn belt in the past month. The ideal time to plant corn is roughly May 1, and the current season is said to be the latest start on corn that anyone can remember. Some fields never will get planted, at least not with corn, and the late start is historically associated with crop yields that are around 10 percent less than usual.
The likely outcome is a 20 percent decline in the U.S. corn crop along with a slight decline in the Canadian corn crop. Some economists think a 20 percent decline in production would double corn prices. Even if the price increase is not that much, the higher cost of corn will put further pressure on world grain markets and the prices of milk, meat, and some of the staples of Mexican food.
