Droughts in the United States and Europe are generating concerns over the supply of grains around the world, and now in Russia and India reports are parts of those countries are also experiencing drought conditions, adding to the concerns of what the yields will end up being for 2012.
On July 20, Russia’s Federal Hydrometeorological Center said the overall grain expected to be produced for the year will come in at only about 80 million tons, plunging from the estimated 94 million tons.
India has also been hindered in its important rice, lentils and oilseeds markets, where sowing of those crops have been delayed because of much less rain than normal.
Parts of Western Australia have experienced dryer weather than normal from April to June, with dry weather surging in July. All of that points to the probability of higher prices going forward.
Countries that are on target for corn production to rise this year are China, Canada, Mexico and Argentina, according to the USDA.
Even with the horrible conditions in the U.S. corn production could still rise to one of the best years in history, based on the enormous number of acres planted. At this time estimates are for 329.5 tons for 2012.
That could easily change if certain parts of the country don't get rain soon. Those are the areas where pollination has yet to set. Once that happens, it won't matter how much rain comes.