A critical time for Md. farmers

`Bleak year' feared as crops fare poorly for lack of rain

Stored grain hurts prices


May 19, 1999|By Ted Shelsby | Ted Shelsby,SUN STAFF

The corn at Phillip "Chip" Councell's Eastern Shore farm is barely out of the ground and already he's mighty nervous.

"We haven't had a significant rain in five weeks," said the 39-year-old grain farmer who plants 750 acres in Cordova, in Talbot County.

It's only the middle of May, but already Maryland grain farmers are nervous about a lack of rain. And weather is just one of the threats they are facing this year. Farmers are looking at receiving sharply lower prices because of surplus grain in storage.

"It's a pretty bleak year for the Maryland grain industry," said Kevin McNew, an agricultural economist with the University of Maryland, College Park.

Said Councell: "I talked with a farmer this morning over in Chestertown; his corn is only an inch and a half tall and it's already starting to die.

"We're at a critical point. Because of the drought last year, there's no reserve moisture in the soil. We are going to need a good rain every week or 10 days the rest of the season to make a crop this year."

Even if farmers get that rain, large stockpiles of unsold grain in storage are pushing prices way down.

In the United States, there are 5.7 billion bushels of corn in storage. That is nearly 60 percent of the 9.76 billion bushels of corn produced last year.

Prices for soybeans, averaging $4.71 a bushel, are off 29.5 percent from last year, which wasn't a good year.

According to the Maryland Agricultural Statistics Service, bean prices are running 44 percent of what they were in May 1997.

"It's not looking good," said Ray Garibay, chief statistician for the Maryland Department of Agriculture.

"The demand for our grain just isn't there. The large carry-over from last year is due to the Asian crisis and the Russian crisis. This country just didn't move the grain it expected to move," he said.

Garibay said the U.S. Department of Agriculture's outlook for grain prices is fairly weak.

"It's not going to be a good year for farmers. There's too much grain in the bin," Garibay said. "It's going to take time for the market to rebound."

Councell, president of the Maryland Grain Producers Association, said the depressed grain prices are already affecting his family's lifestyle, and are having an impact on Maryland's rural economy.

"We've been saying for some time, `If you don't need it, don't get it,' " Councell said. That applies to an assortment of things ranging from a new sofa to a pickup truck.

"I told my wife and kids that we're cutting back to bare bones until we get through this."

That eliminated a winter vacation as well as trips to restaurants every other week to dine out with friends.

Lynne Hoot, executive director of the Maryland Grain Producers Association, expressed concern that the current farm crisis will force growers close to major metropolitan areas to give up farming.

"They are struggling to pay their bills," she said, "at a time the developers, eager to build houses or shopping centers on their land, are knocking on their doors."

Farm equipment dealers are struggling, too.

Michael Asche, owner of Queen Anne Tractor Co., said the John Deere dealership had been growing rapidly since opening in 1992, but not any more. Sales of new and used farm equipment have been tumbling this year.

Asche declined to say how much his business is off, but he said that John Deere & Co. is projecting a 20 percent drop in North American farm equipment sales this year.

He said his lawn tractor business has also "fallen tremendously" in recent weeks. "The lawns are beginning to dry up and they don't need to be mowed. This is extremely early for that to happen. We usually don't see brown grass until mid-July."

According to the Agricultural Statistics Service, rainfall in 17 of 23 counties, including the Baltimore metropolitan area, is below normal. The lack of rain is most noticeable in Howard County, where precipitation in April was 1.7 inches below average.

In Allegany and Garrett counties, rainfall was more than an inch above normal as of April.

Hoot pointed out that there have been serious droughts in Maryland during six of the past 10 years. As a result, she said, many farmers have been forced to increase their debt to pay their bills.

"There are a lot of farmers going into the growing season really in need of a good year," she said. "They are really concerned."

Pub Date: 5/19/99

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