U.S. Midwest farmland flooding forces up food prices
Pastor Dale Morgan
U.S. Midwest farmland flooding forces up food prices*
17 Jun 2008 22:38:45 GMT
*Sandbagging continues on rising Mississippi River
*Breached levee floods more Illinois farmland
*Bush to visit and pledges aid, Democrat critical (Recasts; previous
Quincy, Illinois)
By Nick Carey
KEOKUK, Iowa, June 17 (Reuters) - Volunteers piled sandbags on strained
levees in Iowa holding back the surging Mississippi River on Tuesday as
the worst Midwest flooding in 15 years ruined cropland and continued to
drive up world food prices.
"The water is supposed to crest higher than the devastating floods of
1993. We've put sandbags on top of our new flood wall, but it's going to
be very, very close," said Keokuk city spokesman Susan Dunek in the Iowa
community of 11,000.
The river's projected crest was lowered slightly to below the level of
Keokuk's flood wall, producing a sigh of relief.
Across the river from Burlington, Iowa, a levee broke in Gulfport,
Illinois, sending muddy waters cascading onto nearby farmland and a few
homes. Although sandbagging was going on, no one was injured.
Authorities closed the river bridge and road.
Corn and soybean prices closed near record highs after millions of acres
of U.S. cropland were lost or damaged in the heart of the world's
largest grain exporter. Cattle and hog futures prices also hit new
highs, with soaring feed costs expected to prompt farmers to cull
livestock numbers.
"We've faced some pressure this year, but there could be greater
pressure next year on food inflation when protein prices start to
increase," said Bill Lapp, a food industry consultant and former chief
economist at Conagra Inc.
AID PROMISED
U.S. President George W. Bush promised aid to the stricken region, where
farm and business losses are expected to be in the billions of dollars.
Bush will visit Iowa on Thursday.
"I, unfortunately, have been to too many disasters as president," Bush
said after a briefing on the flooding.
But Sen. Robert Byrd, a West Virginia Democrat, said little had been
done to prevent flooding and Bush had learned nothing from Hurricane
Katrina and other disasters.
"President Bush has asserted that investing in America's needs is
somehow 'wasteful' and his budget, which does not add one thin dime for
a boost in levee funding, reflects this sentiment," Byrd said.
Iowa Gov. Chet Culver said he welcomed word that the U.S. House of
Representatives will include $2 billion for Midwest flood assistance in
a spending bill to be discussed this week.
"In recent days, I have traveled to many communities, and have seen
first-hand the damage that this year's severe weather has brought to our
state. The damage will total in the billions of dollars," he said.
Meanwhile, hundreds of National Guard troops and volunteers joined in
sandbagging efforts across the Midwest. In addition to Iowa and
Illinois, flooding has struck Indiana, Kansas, Missouri, Minnesota and
Wisconsin.
"We have quite a wall of water coming our way," said John Spring, mayor
of Quincy, Illinois. "Flooding is all part of life along the river ...
but this time we are better prepared for it."
Quincy, like Keokuk 30 miles (50 km) to the north, is an historic river
town with several red-brick mansions. Some homes close to the riverbank
were flooded but most of Quincy, Keokuk and nearby Burlington perch on
bluffs or hillsides. The cities' drinking water and some businesses
remain at risk as receding flood waters in Iowa and elsewhere flow
rapidly southward.
FINANCIAL LOSSES MOUNT
Comparisons have been made to the major 1993 Midwest floods that caused
more than $20 billion in damage and 48 deaths. This month's inundation
has caused a few deaths, with Iowa hardest hit. But the physical damage
has yet to be totaled .
Corn prices at the Chicago Board of Trade soared above $8 a bushel for
the first time on Monday and stayed near there on Tuesday amid fears
Midwest farmers will not be able to grow anything on as many as 5
million acres (2 million hectares).
The closing of the mid-Mississippi River to barge traffic is costing
freight carriers $1 million or more per day.
"In 1993, there were months of delays," said Larry Daily, president of
Alter Barge Line Inc in Bettendorf, Iowa. "This time, it's going to be
shut down two weeks if we don't get any more rain -- longer if it rains
again."
The Mississippi River is the main channel for grain flowing from farms
in the Midwest to export terminals at the Gulf of Mexico. It carried 68
million tonnes of farm goods in 2006.
The problems add up to more food inflation for not just U.S. consumers,
but also dozens of countries that buy U.S. grain. The United States
exports 54 percent of the world's corn, 36 percent of its soybeans and
23 percent of its wheat.
Fortunately for residents, the weather was cooperating, with only a
slight chance of thunderstorms in southeast Iowa on Wednesday and a few
scattered showers forecast through the weekend for most flooded areas of
the Midwest.
Officials in Cedar Rapids, Iowa, allowed some residents back into homes
where the flood waters had receded, but they warned of dangers from
sinkholes, unstable foundations, missing manhole covers and hazardous
waste from the flood waters. (Additional reporting by Lisa Shumaker,
Peter Bohan and Christine Stebbins in Chicago, and David Alexander in
Washington; writing by Andrew Stern; Editing by Eric Walsh)