Ideal growing weather coupled with robust grain prices have put Minnesota farmers on the brink of a fall harvest for the ages.
When the U.S. Department of Agriculture rated the crops in every state this week, Minnesota scored a rare trifecta. The condition of its corn crop was best in the nation. So was its soybean crop. Same with its wheat crop.
If that continues, harvest records will topple in all directions. And a bin-buster couldn’t come at a happier time. Grain prices have spiked in the past month, promising a huge payday and an economic lift across rural Minnesota.
Not that Minnesota farmers are doing much boasting.
"You don’t want to jinx anything," said Liz Stahl, an extension specialist in Worthington. "We’ve still got a good amount of season ahead. But I think we’re set up for a decent year, if we can avoid extreme weather and don’t get an early frost."
The summer rain and warmth that have kept Twin Cities lawns lush have had the same effect on the 17 million acres of corn, soybeans and wheat grown in the state.
"We’re pretty much garden central here in Minnesota," said Edward Usset, a University of Minnesota grain-marketing specialist.
But good weather is only part of the story. The recession has ravaged many sectors of the state’s economy, yet agriculture is showing resilience and new strength, both in the short term and longer.
At the Minneapolis Grain Exchange, spring wheat prices had been prairie-flat this year, but then suddenly caught fire in July. Troubled wheat crops in Russia and Canada fueled a big rally, and prices this week surged past $7 a bushel. The rally also sweetened prices for Minnesota’s biggest crops, corn and soybeans. Together, the spike has added more than $1 billion to the value of Minnesota crops.
"For U.S. farmers, it’s kind of hard to believe," said Tim Emslie, a research manager at Country Hedging in Inver Grove Heights. "We have issues in some places, but we’re doing great. There are above-trend yields in corn, in wheat and in soybeans. To have this kind of rally, just as we head into harvest, it’s a little too good to be true."
So folks remain wary, eyeing possible dangers. The rain has been good for crops, but also for weeds. Mold and plant disease, too. In soybean fields, aphids are a problem.
"People are doing what they can to protect the crop, because they have good growing conditions," said Dave Nicolai, an extension educator in crops in Hutchinson, Minn.
Still, there’s no question about the health of Minnesota’s $8 billion corn and soybean crop.
USDA said 90 percent of Minnesota growers reported their corn was in good or excellent condition, a level that earlier record-breaking crop years never reached. For both soybeans and spring wheat, 87 percent of state acres were in good or excellent shape.
Longer term, the sun is also shining on the ag sector. Money is flowing into the commodity sector, farm lenders are holding up well, and Wall Street is keen on farm stocks like John Deere.
"We’ve got a new bull market in agriculture," market analyst Jim Cramer declared Friday on CNBC’s "Mad Money."
But you won’t hear crowing like that from many farmers. Usset, the U’s grain marketer, knows what he’ll hear during an incomparable year.