Since our last update in the July 17 Nutritionist e-Network, most of the cropping regions have experienced favorable weather. The USDA is predicting that the soybean crop will be the largest ever, and the corn crop will be the second-largest. That will keep prices down, although no one expects we will ever see the return of $2 to $2.50 corn.
Compared to a year ago, the price of fine-ground shelled corn (per ton delivered) has dropped 25 percent to 30 percent in many parts of the country. Whole cottonseed has dropped a whopping 35 percent to 40 percent. But the price of soybean meal has gone up about 8 percent.
Why has soybean meal gone up in the face of bumper crops in the U.S.? It goes back to the drought in Argentina last winter and spring, which reduced that country's soybean production by about one-third. In most years, Argentina is the world's No. 1 soybean-meal exporter. With the shortfall in Argentinean production, more of the U.S. soybean crush is going into export channels (although domestic use is still predominant).
Speaking of droughts, some have wondered what the drought in southern Texas will do to the cotton crop, since Texas is the No. 1 cotton state. Tom Wedegaertner, director of cottonseed research and marketing for Cotton Inc., says he is hearing reports that the Texas cotton crop is "spotty," which tells him that much of the crop in Texas is pitiful and some of it is about average. But looking at the country as a whole, the USDA predicts this year's cotton crop will be 13.2 millions, up 3 percent from last year.