June 4, 2019 / 4:48 PM / 4 months ago

While rains swamp U.S. Midwest, parched soils hamper Canadian crops

WINNIPEG, Manitoba/CHICAGO (Reuters) - Unrelenting rains in the U.S. Midwest have stymied planting of corn and soybeans, while just slightly northwest on the Canadian Prairies, dry weather is stunting canola and wheat crops.

While contrasting adverse weather on both sides of the border has given prices a badly needed boost, the prospect of smaller harvests is the latest blow to farmers in both countries caught in protracted trade disputes with China.

“You never want to see another area be in a challenging situation, but we’re watching closely what’s happening in the Midwest,” said Lane Stockbrugger, a Saskatchewan farmer. “It could mean they’re not going to get seeded, and that could prop up canola (prices).”

Canola and soybean prices are related because both produce vegetable oil and livestock feed.

Canada and the United States saw their supplies of canola and soybeans respectively balloon to all-time highs as top importer China all but halted purchases from both countries.

The United States and China have been locked in an escalating tariff fight for nearly a year. China and Canada are in a diplomatic and trade row that has resulted in China blocking imports of canola seed from two companies.

In the United States, a $16 billion aid package to compensate U.S. farmers for lost sales to China will also encourage them to seed whatever they can, even in adverse weather conditions.

Stockbrugger’s own canola crop has poked through the cracked, dry soil. But some Canadian farmers are waiting for their canola to emerge a week after planting.

U.S. farmers, meanwhile, are still struggling with getting crops planted due to rain that turned fields into mud bowls.

The U.S. Agriculture Department (USDA) on Monday said only 67% of the corn crop had been seeded as of Sunday, the slowest pace on record. Soybean plantings were a slowest-ever 39% complete.

Corn seeded after mid-May in many parts of the Midwest faces potential yield reductions, due to risks of untimely summer heat and autumn frost.

This year, final corn plantings will probably end up 10 million to 15 million acres lower than the USDA’s March forecast of 92.8 million as rain left farmers idle for too long, said Scott Irwin, agricultural economist at the University of Illinois.

Precipitation in the past 30 days, as of Sunday, was less than 40% of normal across most of Saskatchewan, the heart of Canada’s canola and wheat output, according to the federal agriculture department. Alberta and Manitoba were also drier than usual.

Farmers have the opposite problem in the U.S. Corn Belt.

Precipitation in May averaged between 150% and 300% of normal, said Don Keeney, senior agricultural meteorologist for weather forecaster Maxar.

“As far behind as (farmers) are, it is going to be tough for them to get everything finished,” he said.

Dryness in the Canadian Prairies was partly a consequence of the Midwest’s wetness, said Andrew Owen, meteorologist at World Weather. The jet stream has dumped so much moisture in U.S. growing areas that there is little left for the Prairies, he said.

Conditions are so bad in Alberta that thousands of people have evacuated their homes due to wildfires, and the federal environment department warned on Friday of poor air quality.

Rain should provide some relief late this week in Alberta and Manitoba, but much of it is expected to miss Saskatchewan, Owen said.

The weather-related problems have recently spurred a rally in corn and soybean prices, tempting some U.S. farmers to take advantage of the late break in the weather, though the optimum seeding window had long passed.

Darin Anderson, a farmer in Valley City, North Dakota, was not able to start seeding corn until May 31. But he was ploughing ahead with his original acreage intentions and had already seeded 600 acres as of Sunday by working 17-hour days.

“We are losing a little bit of insurance coverage and taking more risk,” said Anderson, who still had 500 acres left to go. “We have never planted corn this late before.”

Reporting by Rod Nickel in Winnipeg, Manitoba and Mark Weinraub in Chicago; additional reporting by Nia Williams in Calgary; Editing by Bernadette Baum

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