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Continued: State's farmers escape worst of drought

Like most Minnesota corn farmers enduring the worst drought in more than a quarter-century, Jerry Demmer counts his blessings in bushels per acre. And like the majority of the state's corn growers, he knows he's got plenty to be thankful for.

Just-released crop production figures show that the drought has driven corn yields to a 17-year low nationally. The dry, hot summer has forced some farmers to turn whole fields of barren, sunburned cornstalks into silage. Poor yields have pushed the price of corn toward all-time highs and driven the cost of livestock feed in the same direction.

Experts predict a nationwide explosion of crop insurance claims that will cost private companies and the government billions of dollars.

Yet amid the gloom and doom, Minnesota's corn growers have largely dodged a climate-driven disaster.

The state's corn yields are down for the second year in a row, but only marginally. No run on crop insurance seems likely in the state. Nor do experts expect an epidemic of farm failures.

"There are going to be people who have zero crop," said Demmer, who works 900 acres near Clarks Grove, Minn. "On my farm I have some sandy [soil] pockets. Those are gone. There's no corn in there. But last Sunday, I rode in the fields to check my corn. The ears I peeled back were really nice. Only a couple out of 10 were not filled out."

He'll happily take those numbers amid U.S. Department of Agriculture reports of economically ruinous slumps in other places, especially the Midwest. Released Friday, the USDA's new crop production report estimated corn yields nationally at 123.4 bushels per acre, down 23.8 bushels per acre from 2011 and the lowest yield since 1995.

Yields in Indiana and Illinois are projected to go down more than 40 bushels per acre, Iowa and South Dakota more than 30. However, the yield on Minnesota's 8.25 million acres of corn -- fourth-most in the country -- is estimated to be only one bushel fewer per acre than it was in 2011, down to 155 from 156.

"Nationally, there is a huge devastation to production," said Mark Nowak, a corn and soybean farmer and a banker at Farmers State Bank in Freeborn County. "This could be one of the biggest [supply] deficits ... in the history of the industry."

A bushel of corn now costs more than $8. Fears abound that shortages could drive the price to a once unheard-of $9 a bushel. That would be good news for those with corn to sell. But it could also cripple livestock farmers whose feed costs will spike.

Increased costs in the meat, dairy, food manufacturing and ethanol industries likely will be passed along to consumers for at least the next year, said Ed Usset, a grain marketing specialist at the University of Minnesota Center for Farm Financial Management.

"It's going to be a very difficult year for industries that use corn," Usset said.

A rainy spring

Compared with horror stories in Illinois, Indiana, Iowa and South Dakota, Minnesota looks good, said Mark Seeley, an agricultural climatologist with the University of Minnesota Extension.

Seeley said all or part of 28 Minnesota counties are currently in severe drought conditions. But he said only about 16 percent of the corn crop is rated in poor or very poor condition.

Better land management and drought-resistant seeds may explain some of the difference, Seeley said, but most of the state's good fortune appears due to the vagaries of weather. It turns out that this year, April showers didn't just bring May flowers.

"What saved Minnesota was that April and May were some of the wettest in history," Seeley said.

Moisture stored in the soil from spring's torrents allowed Minnesota farmers to endure one of the hottest, driest Julys ever. Climate maps currently show the drought having no effect on 52 percent of the state.

Of course, not everyone was spared. The last seven weeks have been extraordinarily dry. The USDA has declared a drought disaster in Rock County in the far southwestern corner of the state. And three other contiguous counties -- Pipestone, Murray and Nobles -- have also qualified for federal relief funds.

In Rock County, farmer Lyle Rollag said farms with sandy soil have suffered most because they lose moisture faster. Rollag looks for a corn yield that is 60 to 65 percent of what it was a year ago.

"We will not be able to make the kind of money [this year] that we were able to make in the last three or four years ... but it is not as bad as total disaster," Rollag said. "I don't know of any producer who's said, he's done, he's got nothing."

Varied conditions

Liz Stahl, a crop educator for the University of Minnesota Extension in southwestern Minnesota, said conditions are "all over the board." As she spoke to a reporter on her cellphone, she stood amid cornfields in Lamberton.

"I'm looking at one field where the stalks are totally green," she said. "The field right next to it, about a third of the plants are brown."

"I've talked to people with barren plants -- no ears," Stahl added. "There is certainly going to be a yield hit, but the extent is unclear. It will be pretty severe to not as bad."

Stahl expects corn yields in her area of the state to be 50 percent to 80 percent of normal.

"Even with crop insurance, you're not going to get back what you would have gotten with an optimal yield," she said.

But the run on crop insurance that experts expect nationally likely won't be as severe in Minnesota as it will be in the rest of the Midwest.

Rollag believes there will be some claims in Rock County.

Tom Haag, a corn and soybean farmer in Eden Valley in central Minnesota, grows crops in an area monitors consider unaffected by the drought. He expects corn yields of 150 to 155 bushels per acres, pretty close to where he's been in recent years.

"I don't think we have a bin buster," Haag said. "But we have a good crop growing."

Jim Spencer • 202-383-6123 • jim.spencer@startribune.com Mike Hughlett • 612-673-7003 • mike.hughlett@startribune.com

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