Crop damage from this year's Midwestern floods will total $8 billion, and half of that loss will be in Iowa, according to a report issued June 26 by the American Farm Bureau.
"We're looking at a U.S. corn crop that will be a half-billion bushels short of projections," says Terry Francl, economist for the American Farm Bureau. He estimates the statewide average corn yield for Iowa will be 143 bushels per acre this year, compared with the pre-planting projection of 170 bushels per acre.
The report doesn't factor in replanting, which many Iowa farmers did last week as fields dried from the June flooding. Farmers who replanted areas of fields can expect yields, at best, of only about half of normal levels because of the shortened growing season, says Francl.
2008 not a year to make money
He says crop insurance is likely to cover about 50% to 60% of the crop losses. "So, considering the lower yield, you won't be making much money even with crop insurance settlements," he adds. "With today's prices for corn and soybeans, that represents a huge lost opportunity this year in terms of revenue farmers won't earn because of the adverse weather."
Of the Midwest states plagued by flooding in June, Iowa was hit hardest, incurring about $4 billion in crop damage. The Farm Bureau analysis shows that Illinois' losses will be about $1.3 billion, Missouri $900 million and Indiana and Nebraska $500 million each.
The Farm Bureau's estimate is the second major assessment of the flood damage, and it tops the $2.5 billion to $3 billion loss projected for Iowa projected two weeks ago by USDA. Last year, Iowa's corn crop was worth $9.5 billion and the soybean crop was worth $4.8 billion.
Estimates for crop loss only
These estimates don't include any losses to livestock, structures or equipment or buildings. They also don't include damage to roads, bridges and railroads. The analysis also assumes normal weather conditions for the remainder of the growing season.
"These are estimates based on conditions so far, and things can change with markets and with the weather," says Francl.
Iowa's livestock and biofuel industries are looking at a grim year in 2008 due to high prices for corn and soybeans, he notes. Corn is the feedstock for ethanol and soybean oil is the main feedstock for making biodiesel. Corn futures prices have jumped to the $7.50 range and soybeans have jumped to $15.75 per bushel.