The worst U.S. drought in more than five decades is forecast to raise farm profits to a record $122.2 billion this year as higher prices and insurance payments outweigh crop losses from the dry conditions.
Income will rise 3.7 percent from a revised $117.9 billion in 2011, the U.S. Department of Agriculture said Tuesday in a report on its website. The forecast is up from $91.7 billion in February.
In related news, I cancelled more classes this year due to bad weather (i.e., I don't like to walk around campus in the rain) and my income has gone up 3.7% as a result. I love the NC state university system!
This summer, corn prices are high. Drought, extreme weather, and other factors combine to increase corn prices, and one of those factors is the federal ethanol mandate/renewable fuels requirement implemented over 20 years ago (as an oxygenate requirement) and extended in 2005. Roger Pielke Jr. points to a Purdue research paper that suggests that a waiver or partial removal of the renewable fuel standard could reduce corn prices by 20% or more. ...
This year’s drought has been painful and costly, but if in the process it leads to the demise of ethanol subsidies, boutique fuels, and the renewable fuels standard, that’s what I call a silver lining.
The latest outlook released by the National Weather Service on Thursday forecasts increasingly dry conditions over much of the nation’s breadbasket, a development that could lead to higher food prices and shipping costs as well as reduced revenues in areas that count on summer tourism. About the only relief in sight was tropical activity in the Gulf of Mexico and the Southeast that could bring rain to parts of the South. ...
Yes, the drought has gotten so bad that we are hoping for a hurricane. Meanwhile, in the commodities markets the reduced supply is increasing prices:
An analysis released on Thursday by the United States Drought Monitor showed that 88 percent of corn and 87 percent of soybean crops in the country were in drought-stricken regions, a 10 percent jump from a week before. Corn and soybean prices reached record highs on Thursday, with corn closing just over $8.07 a bushel and soybeans trading as high as $17.49. ...
Since corn is an input for beef, higher input prices decrease supply and increase beef prices:
The withering corn has increased feed prices and depleted available feeding land, putting stress on cattle farmers. A record 54 percent of pasture and rangeland — where cattle feed or where hay is harvested for feeding — was in poor or very poor condition, according to the Department of Agriculture. Many farmers have been forced to sell their animals.
Because feed can account for nearly half of a cattle farmer’s costs, consumers could see a rise in the price of meat and dairy products, experts said.
March 2012 will go down as the warmest March in the United States since record-keeping began in 1895, NOAA said Monday.
In addition, the three-month period of January, February and March was the warmest first quarter ever recorded in the Lower 48 states. The average was 42 degrees Fahrenheit, a whopping 6 degrees above the long-term average.
A staggering 15,292 warm temperature records were broken, (7,755 record highs and 7,517 record high overnight lows), according to Chris Vaccaro, spokesperson for NOAA. "That's tremendously excessive. The scope and the scale of warmth was really unprecedented, Vaccaro said.
Short-term weather patterns such as the one that affected the United States are poor indicators of global climate trends, however. Parts of the world, most notably Eastern Europe, experienced below-average to extreme cold temperatures this winter.
Economic forecasters sometimes use the inability of weather forecasters to get it right as a defense for poor economics forecasts "Hey, we're no worse than the weather forecasters." Well...
Two top U.S. hurricane forecasters, revered like rock stars in Deep South hurricane country, are quitting the practice because it doesn’t work.
William Gray and Phil Klotzbach say a look back shows their past 20 years of forecasts had no value.
The two scientists from Colorado State University will still discuss different probabilities as hurricane seasons approach — a much more cautious approach. But the shift signals how far humans are, even with supercomputers, from truly knowing what our weather will do next.
Gray, recently joined by Klotzbach, has been known for decades for an annual forecast of how many hurricanes can be expected each official hurricane season (which runs from June to November.) Southerners hang on his words, as even a mid-sized hurricane can cause billions in damage.
Last week, the pair dropped this announcement out of a clear, blue sky:
“We are discontinuing our early December quantitative hurricane forecast for the next year ... Our early December Atlantic basin seasonal hurricane forecasts of the last 20 years have not shown real-time forecast skill even though the hindcast studies on which they were based had considerable skill.”
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