This is a tough year for American farmers—severe drought has gripped much of the country and crops planted this spring are failing. The Department of Agriculture has now scaled back its forecasts for 2021 production and inventories of corn, wheat, and soybeans are expected to fall to their lowest level in nearly a decade, the Wall Street Journal reports. With extreme drought conditions in states including Nebraska, Iowa, and Minnesota, some 63% of the spring wheat crop is classed in poor or very poor condition, compared to 6% last year, the USDA says. Wheat and corn prices have risen around 11% so far this year and analysts expect prices to keep climbing if the hot, dry weather persists.
A lack of output meant many farmers were unable to cash in on crop price rallies earlier this year—and even those that did are struggling to deal with soaring inflation, Bloomberg reports. Farmers say fertilizer costs have almost doubled in the last 12 months. And the US isn't the only place where crops are wilting, the Journal reports. Drought has caused a sharp lowering of crop forecasts for wheat in Russia and corn in Brazil. In the western US, where the heat has caused massive wildfires as well as crop failures, National Oceanic and Atmospheric Administration meteorologists warned last week that drought conditions are likely to persist into late fall, reports the New York Times. (Read more drought stories.)