Double-Dipping?
July 12, 2010 On an almost daily basis, there has been a steady, yet gradual, uptick in the number of news articles talking about the nation experiencing a double-dip recession. Most of these cite stagnant employment numbers, tepid consumer spending, and slow construction figures as evidence that America’s recent economic sigh of relief at the start of 2010 could have been a bit premature.
For the most part, agriculture has not suffered from these same concerns. Manufacturers I’ve spoken with are reporting steady sales increases. Likewise, ag retailers have told me that they have been very busy during the spring months of 2010, providing both custom application and crop inputs in healthy amounts. Perhaps most importantly, grower-customers in many regions of the country have been blessed with good weather, allowing them to plant their crops earlier than was possible during 2009’s very wet spring.
But there could be danger lurking. Last week, I spent the better part of my time driving around portions of Iowa, Missouri, Nebraska, and eastern Kansas. While corn and soybean fields in my native Ohio generally look robust and tall, I wasn’t finding this to be the case in the states I was visiting. In many parts of Nebraska and Iowa, I saw plenty of corn and soybean fields that looked like small lakes, with their crops under a few feet of water. Indeed, whole fields in Iowa looked drowned, with only a few yellowing corn leaves poking up through the mini-waves.
On the flipside, many parts of this section of the Corn Belt have been too dry. The long-range weather forecast from mid-July forward in this part of the country is calling for temperatures to average near 100 degrees, which could damage corn pollination and reduce yields.
Obviously, this could mean trouble for the ag marketplace. Lost production could mean less money to go around for ag retailers during fall 2010 and spring 2011, perhaps triggering a recession in spending for agriculture. Given how badly many ag retailers were hurt financially during the inactivity/nonapplication trend that took hold of the industry during 2009, I hope we are not seeing history repeat itself.
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