The outlook for Minnesota crops is finally sunny

New corn
Minnesota farmers have struggled to finish spring planting, but may still have good crops this fall if the weather cooperates. These corn plants on the Richard Peterson farm in Jackson County are about four inches tall and growing fast, as seen on Thursday, June 2, 2011.
MPR Photo/Mark Steil

The corn is up and growing fast on the farm Richard Peterson and his brother run in southwest Minnesota, with the plants about four inches high.

The nice looking stand of corn didn't seem possible a little over a month ago. Fields were too muddy for a tractor, and planting was impossible on the Peterson farm in Jackson County. For them and many other farmers, it's been a struggle. Too much rain and cool temperatures stretched out the job of planting the crop.

But a short period of dry weather that developed the first week of May considerably improved planting conditions, allowing the Petersons and other Minnesota farmers to catch up on their corn planting.

Peterson and his brother moved quickly to plant their roughly 650 acres of corn.

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"The corn went in really good," he said. "We got her done in, I suppose, in about four or five days."

Corn rows
The corn is up and growing on the Richard Peterson farm in southwest Minnesota, as seen here in a photo taken Thursday, June 2, 2011. Peterson planted his corn in early May.
MPR Photo/Mark Steil

After that brief opening the weather turned rainy again. Soybean planting took several weeks. The brothers worked on those rare days when the soil was dry enough to support a tractor. They just finished soybean planting last week.

"It was good to get them done," Peterson said. It was time."

Similar planting problems afflicted Minnesota and the nation, causing delays that raised concern in grain markets about a poor fall harvest. That's a big worry because right now corn supplies are at their lowest level in 15 years and prices are already at historic highs.

Much of the concern focused on the crop from the eastern corn belt, in states like Ohio.

"It's been one of those years that you don't want to talk about," said Mel Borton, a retired farmer who works for the National Farmers Union in Ohio.

"Every week we got a rain," he said.

Richard Peterson
Richard Peterson has been farming since the early 1960s.
MPR Photo/Mark Steil

There was so much rain that Ohio farmers got very little planting done until a week ago. Then the weather turned warm and dry, turning the spring planting bust into a rush. In the last seven days, Ohio farmers planted nearly 40 percent of their corn. But they've still got another 40 percent to go.

That same warm weather also helped Minnesota farmers catch up, allowing them to plant 95 percent of the corn and 75 percent of the soybeans.

Wells Fargo agricultural economist Michael Swanson said the improved weather has boosted the outlook for the fall harvest.

"We can still get a decent yield," Swanson said.

That's important news for Minnesota because the corn and soybean crops combined are worth about $13.5 billion to the state's economy.

Swanson said there are a host of weather obstacles to clear before farmers can start counting their profits. Too little or too much rain probably top the list. Then there's the annual concern about an early frost.

Farmland ponds
Too much rain this spring in many parts of the state have left ponds like this on some farmland.
MPR Photo/Mark Steil

But right now, Swanson said, the outlook for farming is improving. He said the prospect of good yields is great news for farmers, who would have plenty of grain to sell at a time when prices are high. And the grain is attracting plenty of buyers, from ethanol producers to livestock feeders.

"Everything's still working for the grain markets," Swanson said. "Export demand is still very strong. We're seeing biofuels demand is still a big block of demand that doesn't appear to be going away. And feeding is still proceeding at a pretty good rate."

The poor planting weather helped boost grain prices over recent weeks but that concern is abating. As crops progressed recently, worries of a short harvest faded, pushing grain prices lower. It's unclear how long the decline will continue, but even a 10 percent drop in grain prices would still give farmers a substantial profit this fall.

Many farmers won't wait that long to sell. As prices were peaking this spring, farmers like Richard Peterson locked in a fat profit margin by pre-selling a portion of their fall harvest on the futures market.

"I would say we're probably getting up to 40 percent," he said.

Peterson said it's up to the weather now to grow the bushels he needs to fulfill those contracts.