U.S. Mid-West Grain Harvest At Risk For Major Crop Failure
Written by Chriss W. Street
The Gulf of Mexico high pressure dome has moved North, bringing record Mid-West heat and humidity that now risks major crop failure across the world’s largest grain belt.
The upper Mid-West normally experiences cool and dry summer evenings that allow grain crops to absorb energy in the daytime and recover at night. The mechanism that drives this normal weather pattern is the atmospheric Jet Stream forming a normal-“S” pattern each Spring that suck in cold North-Atlantic surface temperatures that curve around an upper Mid-West low pressure dome and around the Western Plains, then is sucked around a Southeast high pressure dome and down into the Gulf of Mexico.
But the Jet Stream pattern that has delivered record grain yields since 2013 has just flipped to a backward-“S” this Spring, due to very warm North-Atlantic temperatures. Hot Western Plains temperatures are being sucked around a high pressure dome in the upper Mid-West, and then sucked around a low pressure dome across the Southeast and down to the Gulf of Mexico.
As a result, Florida is being hammered with torrential rainfall and the upper Mid-West is suffering near record hot and sticky daytime temperatures that are not cooling off at night.
The last time this phenomenon happened was 2011-2012, when the prices for basic commodity foodstuffs went up tremendously including:
Corn: Up 63%
Wheat: Up 84%
Soybeans: Up 24%
Sugar: Up 55%
Net cash farm sector incomes hit an all-time record of $202.3 billion in 2022. But high crop yields caused net cash farm incomes to fall back by -$41.8 billion (-20.7 percent) to $160.4 billion in 2023. The latest US Department of Agriculture forecast predicted another big crop year would push net cash farm incomes down by another -$38.7 billion (-24.1 percent) to $121.7 billion in 2024.
Over the last century the current weather June pattern devastated US crop yields in 2012, 2011, 2010, 1988, 1955, 1936, and 1934. If the current destructive pattern holds, the United States could suffer all-time record high temperatures for the back half of June and corresponding severe crop loss failures across the Mid-West grain belt.
Commodity food prices tend to be volatile because demand for many commodities is relatively inelastic, which basically means everyone has to eat. Small shifts in supply or demand can lead to large price changes, such as the big moves during the pandemic lockdowns in 2021 and 2022. But with prices subdued in 2023 and forecast to fall in 2024, the current weather pattern could cause a severe supply shock and price spikes.