Worst drought in 50 years could last through October

Forecasters at the?National Oceanic and Atmospheric Administration's Climate Prediction Center were unable to assure growers that there is an end to the drought in sight. In the meantime, grain prices have skyrocketed.?

By Karl Plume and Deborah Zabarenko,?Reuters / July 19, 2012

Rain clouds form to the east of parched Vigo county cornfields in Terre Haute, Ind. Rains have come too little and too late to save much of Indiana's corn crop.

AP Photo/Tribune-Star, Jim Avelis

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Grain prices pushed to record highs on Thursday as scattered rains in U.S. Midwest did little to douse fears that the worst drought in half a century will end soon or relieve worries around the world about higher food prices.

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Government forecasters did not rule out that the drought in the U.S. heartland could last past October, continuing what has been the hottest half-year on record.

"There's a greater chance that there is no relief possible or in sight" for the U.S. Midwest, Dan Collins of the National Oceanic and Atmospheric Administration's Climate Prediction Center said on Thursday.

More than half the United States was experiencing moderate drought or worse this week, according to the latest U.S. Drought Monitor report issued on Thursday.

More than 70 percent of the Midwest Corn Belt was in some stage of drought in the week ended July 17, up from 63 percent a week earlier. It adds up to the worst drought conditions in the United States since at least 1956, climate experts said.

"We don't have a reason for saying it's going to improve," Kelly Helm Smith of the National Drought Mitigation Center told a briefing on Thursday, adding that warmer conditions in the coming months might well exceed current levels.

Crops Plowed Under?

That is bad news for farmers and consumers, with corn, soybeans and wheat in the United States -- the largest world exporter of those key crops -- baking in fields, losing yield potential daily or being plowed under for insurance claims.

Corn for September delivery at the Chicago Board of Trade set a record high of $8.16-3/4 a bushel, while soybeans for August delivery also set a record high of $17.49. Wheat for September rose 4 percent at $9.35 and set a four-year high.

The knock-on effect of such soaring prices was already being felt around the world, where drought has also hit other grain exporters who are starting to cancel previous sales and leave hungry countries in the Middle East and elsewhere scrambling.

"A lot of buyers waited in the hope that rain in the U.S. and east Europe would cool prices," one grain exporter said. "But this is not happening and the U.S. drought is not over."

Source: http://rss.csmonitor.com/~r/feeds/csm/~3/-MqbIYzTsZE/Worst-drought-in-50-years-could-last-through-October

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