Weather impacts on U.S. agricultural supply chain

Date:10-20-2022

By Jim Foerster

If it not enough that farmers have had to contend with extreme heat and drought this year, many farmers, particularly in the corn belt, are now facing potential frost and freeze damage. Late planting in the spring pushed back harvest timing and many states still have plenty of corn and soybeans yet to reach maturity. As of last week, reports show that corn maturity on the national scale was at 75 percent while soybeans dropping leaves were at 81 percent, leaving nearly 25 percent of the crop still vulnerable to frosts to some degree, and in Ohio and Pennsylvania, that total could be as high as 40 percent.

Frosts in the southern corn belt are coming about two weeks earlier than normal and another step downward is expected next week as well, according to my DTN colleague, John Baranick, an agricultural weather specialist. Models again are bringing a strong cold front through the country this week and if areas escape the killing frosts with this blast, they will be at risk again next week as the pattern turns more favorable for additional surges of cold air. Only time will tell how vulnerable crop yields really are to these killing frosts.

This frost and freeze threat to crops follows some other impactful weather events. Outside of the crop-focused weather impacts, fertilizer prices have also been taken a hit because of weather events and, in turn, the prices are impacting producers now. The fertilizer price issues started in 2021 with the Texas cold blast in February and then Hurricane Ida in August, with both events contributing to the disruption of fertilizer production. Then, prices of natural gas, which is a key input in producing nitrogen, spiked in Europe, creating even more pricing issues. While the price of fertilizer has spiked before, producers today are seeing some of the highest prices ever for fertilizer, with sticker prices as much as 150 to 300 percent higher than recent years.

Fertilizer isn’t the only related input impacting US agricultural producers. This summer’s weather has impacted transportation as well. Recent reports are showing that low water levels in the Mississippi River are having an impact on barge traffic. While the river is often at lower levels in the fall, this year’s extremely dry summer has made the level particularly low and could see its lowest levels in a decade. These lower water levels mean that fewer barges can be on the river at the same time and need to carry lighter loads than usual because of the water levels. This decrease in traffic levels is leading to backups in shipping commodities including corn and soybeans on the river this week, with long lines of trucks waiting at loading facilities. The delays hurt farmers and contribute to higher retail food prices.

Producers use weather data on a regular basis to make ongoing growing decisions, such as monitoring precipitation, wind, temperature, and soil conditions to manage irrigation systems, prepare for field workability, and schedule field fertilization and pesticide application. But with weather patterns altering and extreme weather events occurring more often, both agricultural practices and the supply chain that delivers may change.