Sunday, November 16, 2014
Nebraska's Mountains Of Corn Continue To Grow
Two years ago, area farmers were cashing in on corn worth $8 or more a bushel. Times were good in rural Nebraska as money trickled down to other sectors of the economy, including main street businesses.
But two years makes a big difference. Today corn for November delivery in Dorchester is around $3.40 a bushel.
It's not just farm commodities that are under pressure. So are oil and precious metals. It appears the market recognizes that the U.S. economy, while keeping its head above water, continues to be under some serious stress as global growth wanes and our government presses on with high taxes, environmental agendas and healthcare mandates.
When it comes to corn prices, consecutive years of near-record harvests mean farmers have simply produced more than a slow-growth market needs. A story in today's Lincoln newspaper details the situation in Nebraska -- where "a temporary mountain range has sprouted ... as farmers bring in one of the most bountiful harvests in the state's history."
According to the Journal Star, "despite years of steady growth in storage capacity, grain has filled up nearly every bin and silo and overflowed, forming massive ground piles that stand stories high."
The story points out that commercial storage space in Nebraska grew from 455 million bushels in 2011 to 491 million as of June and likely has topped 500 million with new facilities having come online since then. And yet there's still an estimated 65 million bushels of corn currently laying on the ground in Nebraska.
This doesn't even include on-farm storage, which has grown to 1.15 million as of 2013, the most recent year for which information is available from the U.S. Department of Agriculture.
Forecasters expect Nebraska's 2014 corn crop to come in at 1.58 billion bushels, down 2% from last year's record. Soybean production in Nebraska is forecast at a record high 284 million bushels, up 11% from a year ago.
The Journal Star mentions Dorchester-based Farmers Cooperative, "which boasts about 58 million bushels in permanent storage capacity, went into harvest season with only 5% of its space taken up. Its bins and silos are now full, and about 8 million bushels of grain is on the ground in more than 15 piles, said President Ron Velder."
"Despite a wet start to the fall, Velder said, the majority of corn has come in at low enough moisture levels to not need drying and can be stored without worrying about spoilage. Only corn that was replanted due to storm damage seems to need a bit of drying out."