Corn, Soybean Forecast May Dampen Aid

Source from:  By LIBBY QUAID AP Food and Farm Writer 09/22/2006

The outlook is improving for the nation's corn and soybean farmers, and that may dampen the effort in Congress to spend billions of dollars in drought aid. Despite withering heat and dryness in some parts of the country, this year's harvest should be the second-best on record, the Agriculture Department said in its monthly crop report Tuesday. Anticipating higher yields, analysts boosted the production forecast by 6 percent for soybeans and 1 percent for corn. That may sound incredible to farmers and ranchers suffering from prolonged drought, but significant rains last month helped relieve drought that has lingered in soybean fields and pastures in the western Corn Belt and across much of the Plains. "The effects of the drought seem to have stabilized," said Keith Collins, chief economist for the department. Nationwide, yields look promising: Soybean yields should average 41.8 bushels an acre, up 2.2 bushels from last month's forecast, and corn yields should be 154.7 bushels an acre, up 2.5 bushels from the forecast last month. "Which is a pretty good yield, considering the very difficult weather season we've had in so many of the western states," Collins said. The rosier outlook should bolster the Bush administration's resistance to a massive, $6.5 billion drought relief plan in Congress. The White House opposes the plan because the money would be unfairly distributed, Agriculture Secretary Mike Johanns said. "You do not have to suffer any kind of loss to be the beneficiary of the bills that are being debated," Johanns told members of the National Farmers Union Monday in Washington. Buy AP Photo Reprints So far, Bush is providing much more modest aid, including $50 million for livestock producers. In all, the administration has promised nearly $780 million to drought-stricken farmers; the amount includes $700 million in already-planned payments that farmers will be getting sooner. Johanns wants to see how the fall harvest goes before committing to more aid dollars. But critics argue more aid is needed now. "This is a September issue. This needs a vote before we go home for the elections," Rep. Earl Pomeroy, D-N.D., said Tuesday. Sen. Ken Salazar, D-Colo., said: "President Bush won big in rural America. He ought not let down the people of rural America in the days ahead." Also in the crop report: -Soybean production is forecast at 3.1 billion bushels, up 165 million bushels from last month's forecast. Price estimates dropped 10 cents to $4.90 to $5.90 a bushel; last year's average was $5.68. -The production forecast for corn is 11.1 billion bushels, up 138 million from last month's forecast. Prices were unchanged at $2.15 to $2.55 a bushel, compared with $1.99 last year. -The wheat forecast was unchanged, with production at 1.8 billion bushels. -Tobacco farmers are rebounding after the tobacco buyout in 2005; their crop should be about 15 percent bigger this year. -The peanut crop should be 34 percent smaller than last year, the smallest crop in 26 years. -The cotton crop should be down 15 percent from last year's record. -The rice crop should be down 13 percent from last year. Enditem