News

Forecast for strong El Nino conditions

A report shows the forecasted El Nino will be beneficial to corn and soybean yields in the majority of the Corn Belt.

Jerry Lehnertz, vice-president of lending for AgriBank says above-average sea temperatures in parts of the Pacific Ocean historically have resulted in favorable growing conditions across much of the Midwest.  “The areas that I would categorize as ‘fringe’ would be the Eastern Corn Belt,” he says.  “Ohio and Indiana – where they are already experiencing the effect of a wetter than normal spring season.  So probably not as positive for some of those growers.”

He tells Brownfield the El Nino’s potential positive affects for yield could result in additional pressure on the markets.

And growers should be prepared.  “Take advantages of opportunities to price the 2015 crop and perhaps even the 2016 crop on potential price rallies,” he says.  “Because we believe that if the predictions for the El Nino and the impacts that El Nino materialize it will be positive for yields and create downward pressure on pricing.”

The National Oceanic and Atmospheric Administration (NOAA) says the consensus from forecasters is for a strong El Nino event that has a 90 percent chance of persisting through fall and an 85 percent chance of lasting through winter.

AgriBank is owned primarily by 17 affiliated Farm Credit Associations and covers 15 states across the Midwest from Wyoming to Ohio.  About half of the nation’s cropland is located within the AgriBank District.