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Nov 21, 2022

The USDA's November World Agricultural Supply Demand Estimates report saw an unexpected change.

Dan Basse with Ag Resource Company says the surprise in the report was an increase in yield for US Corn and Soybeans:

"That extra supply ended up coming through in both end-use stocks and U.S. soybean. End-use stocks were up 10 per cent or 20 million bushels to 220 million bushels. The corn was still relatively tight, it was a little under 1.3 billion bushels."

Basse says they believe the larger crop is likely due to the favorable harvest weather for much of September and October.

Basse says it was a surprise to see the yield increases because any increases tend to be carried over to the final report in December.

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Video: Wheat Yields in USA and China Threatened by Heat Waves Breaking Enzymes

A new peer reviewed study looks at the generally unrecognized risk of heat waves surpassing the threshold for enzyme damage in wheat.

Most studies that look at crop failure in the main food growing regions (breadbaskets of the planet) look at temperatures and droughts in the historical records to assess present day risk. Since the climate system has changed, these historical based risk analysis studies underestimate the present-day risks.

What this new research study does is generate an ensemble of plausible scenarios for the present climate in terms of temperatures and precipitation, and looks at how many of these plausible scenarios exceed the enzyme-breaking temperature of 32.8 C for wheat, and exceed the high stress yield reducing temperature of 27.8 C for wheat. Also, the study considers the possibility of a compounded failure with heat waves in both regions simultaneously, this greatly reducing global wheat supply and causing severe shortages.

Results show that the likelihood (risk) of wheat crop failure with a one-in-hundred likelihood in 1981 has in today’s climate become increased by 16x in the USA winter wheat crop (to one-in-six) and by 6x in northeast China (to one-in-sixteen).

The risks determined in this new paper are much greater than that obtained in previous work that determines risk by analyzing historical climate patterns.

Clearly, since the climate system is rapidly changing, we cannot assume stationarity and calculate risk probabilities like we did traditionally before.

We are essentially on a new planet, with a new climate regime, and have to understand that everything is different now.