Rising Floodwaters Sink Farmers' Hopes

June 11, 2008— -- In field after field across the farm belt, crops are underwater. Parts of the Midwest are already suffering their wettest spring on record, and at this point, there is little relief in sight.

Jerry Bradley, a fifth-generation farmer in Sun Prairie, Wis., has geese swimming in his corn fields.

"I probably had 100 acres underwater in '93. This is twice as bad -- this is the worst I've ever seen it," he said, staring out over acre after acre of flooded fields.

Much of the corn that managed to survive these floods is yellow and stunted.

"Every Father's Day for the past five years, corn has been knee-high already, but now, it struggles at just a couple inches in height," Bradley said, pointing at corn stalks that barely reach the laces on his muddy work boots.

Flood waters have already damaged an estimated 20 percent of the Midwest's corn crop.

"We are on the very verge of a potential disaster in 2008 corn production," said Rick Feltes, senior vice president and director of commodity research for MF Global, the world's largest commodities brokerage firm.

With a cold, rainy spring, farmers have already gotten a late start on the growing season.

"We have over 4 million acres that are still sitting in the seed bag because of the flooding in Indiana, Iowa, Illinois, [and] Missouri. And as we look ahead to the next six weeks, the weather will be critically important," Feltes said.

Already, the government is predicting a thinner harvest, sending corn futures prices to record highs. That will likely translate into higher prices for corn-based products -- everything from soda and chips to milk and beef that come from corn-fed cattle.

"We are already seeing it. The market is already anticipating this and is already building-in some of the prices," National Corn Growers Association president Ron Litterer said.

The timing couldn't have been worse. Food inflation is already at its highest in nearly two decades. A gallon of milk costs 21 percent more than it did a year ago, and the price of a dozen eggs is up 28 percent.