Corn harvest exposes U.S. fragility

The United States is experiencing one of the largest corn harvests in history, surpassing the 400 million-ton mark, but what could represent prosperity has turned into a warning signal for the American agribusiness. The information is from Carlos Cogo, Managing Partner of Cogo Inteligência em Agronegócio. With the price of corn falling to around US$ 3.90 per bushel, well below the US$ 4.60/bushel needed to cover the average production costs in states like Iowa, many producers are facing losses even in the face of a record harvest. In parallel, the American agricultural debt has reached the historic level of US$ 540 billion, amid high interest rates and increasingly restricted credit. This combination has been pressuring, especially, the tenant farmers, who are operating at a loss and losing investment capacity. The absence of China in purchases of this harvest and the reduction of official USDA estimates exacerbate the uncertainty in the market. The abundant supply and stable ...