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With fertilizer costs high and seeds scarce, U.S. farmers turn to soy -Breaking


© Reuters. FILEPHOTO: A farm with soybean plants about 45 days prior to harvest is seen near Norborne in Missouri on August 28, 2018. REUTERS/Dave Kaup/File Photograph


Julie Ingwersen and Mark Weinraub

CHICAGO, (Reuters) – North Dakota farmer Jennifer Meyer devotes approximately 20% to corn on her 2,500-acre farm. Corn provides a quick feed for her cattle that she and her husband raise together.

Because she can’t find the correct fertilizer for the yellow crop, Meyer is trying to find another crop. Meyer has decided to plant soybeans instead of corn because she found the right pesticide for that crop.

Meyer said, “That is one of the greatest things.” Finding a way to get rid of all the weeds is key.

Inflation and global supply chain issues have caused fertilizer prices to soar and many vendors were forced to sell out. The cost of bread and cereal could rise due to limited plantings of corn and wheat, both of which are highly fertile. The demand for U.S. corn and wheat could increase if Ukraine or Russia enter into a war that would disrupt the shipments of these two important export nations.

Russia is both a large producer of potash and an exporter. This key ingredient in the production of nitrogen fertilizer, plays a significant role.

Russia and Ukraine jointly account for 29% global wheat exports and 16% of world corn exports. As tensions increase, some traders scramble to ensure alternative sources.

The rise in consumer prices in the United States was due to increased demand for bakery and cereal products. In 2022, food inflation could continue to increase because of tight crop supply. Soybeans are used mostly in animal feeds and biofuel.

Although U.S. farmers increased their winter wheat seeds in the autumn, there were concerns that a drought in Oklahoma and Kansas could cause a shortage of winter wheat. This may have caused further price shocks.

The prices of other Plains crops such as oats, barley, and canola are also attractively high, which could limit spring wheat production. Private analysts already have lowered their spring wheat planting expectations.

Frayne Olson from North Dakota State University, an agricultural economist, said that wheat ranks near the bottom in budgeting in terms of return per acre.

A few areas are also short of spring wheat seeds because of last year’s drought, which caused havoc on the Northern Plains of the United States. Farmers will have to purchase the necessary seed this year.

Bryan Jorgensen (who grows and sells seed Wheat near Ideal in South Dakota) said that he has about 20% less than what he normally has. It’s going be tough. 

This Thursday will see the United States release their latest 2022 crop forecasts. Reuters analysts polled estimated that corn acreage would fall by 1.6million acres, or 1.7% from last year. Soy plantings will increase by 2,000,000 acres, which is 2.3%, according to Reuters. Soybeans are less fertile than either wheat or corn.

The price of wheat has risen as tensions rise between Russia and Ukraine. However, U.S. Farmers still look for crops that don’t cost as much over the duration of their growing season.

Dennis Haugen (a North Dakota farmer who also sells seeds) said that “all crops have good value.” These are crazy prices. Because they have to spend less on fertilizer, there are men who will plant beans or peas.