Some crops suffering, but most are in fine shape across state

Crop progress on the Richard Peterson farm near Mountain Lake in southwest Minnesota so far this year has been mixed. He has a corn field that's looking good.

"I suppose it's knee high or better," said Peterson.

That's a couple weeks ahead of the old 'knee high by the fourth of July' standard. But other crops are suffering.

"We're standing here by a field right now that's under water," said Peterson.

Ducks swim in a roughly 20-acre pond that's formed on land which should be growing soybeans. Shore birds dart along the water's edge. It's not been the type of spring Peterson wanted.

"Wet," said Peterson. "We've had over 20 inches of rain I'm sure."

That's about three times what normally falls during the spring. It's been so wet that Peterson still has some soybeans to plant. His experience is common across the southern half of Minnesota. Torrential rains have plagued parts of the region, delaying field work or drowning out crops or both. There's also been plant-killing hail, and even some scattered damage from a frost in May. Then there are areas of the state where farmers have the opposite problem. The skies have been too quiet.

"Everybody's got a lot of faith, but every day that goes by without rain. There's a lot of concern," said Curt Pederson, who manages the Farmers Elevator in the town of Bellingham. Much of west central Minnesota is abnormally dry, and there's even drought conditions along the border with south Dakota. He says some days the temperature has been close to 100 degrees.

"It's that windy, hot weather that's really hard on that corn," said Pederson.

The uncertain weather is causing problems for the affected farmers. But they're in the minority. More fields are thriving than struggling. In fact, the U.S. agriculture department says more than 75 percent of the state's corn soybean and sugar beet crops are in good to excellent condition. Spring wheat is slightly lower, rated a still good 64 percent.

"Minnesota's looking really good," says Wells Fargo agricultural economist Michael Swanson. "I don't know if we can replicate last year's monster crop yield, but certainly everybody should expect average or above-average right now given the condition."

But overshadowing this year's good start are continued low grain prices. Crops all across the Midwest are mostly healthy. Grain traders expect another big harvest and that ample supply is keeping prices low. Right now corn brings about $3.40 cents a bushel. Swanson says most farmers need more than that to make money. He says the best news so far this year is that some crop input costs have declined a little.

"The big three — cash rents, seed and fertilizer — have all kind of come back to adjust for the lower prices," said Swanson.

He says the outlook for grain prices is grim as far as the eye can see. A drought or other weather disruption might boost prices, but he says such a jump probably would be temporary. World supply is growing as farmers all over the globe increase their productivity. And those healthy supplies will likely mean continued low grain prices and financial stress for state producers.

Southwest Minnesota farmer Richard Peterson says he has fairly low debt, so he expects to withstand the price downturn. But he says farmers with higher debt loads are feeling the pressure.

"There's people that's going to be stressed, there's no doubt about that," said Peterson. "But hopefully everybody will make it through and survive it."