The United States will have plenty of food to feed its citizens and to sell to foreign customers even though the unrelenting drought is likely to chop grain production by nearly one-third, the government says.
In addition, the drought should add only one percentage point to the Consumer Price Index for food this year and only two points next year, according to the Agriculture Department. Each point costs a family of four an estimated $50.The department, in its most accurate measurement yet of drought damage, said Thursday that grain production this year should total 197 million metric tons, 31 percent below last year. In July, a 24 percent drop was projected.
Large reductions are forecast in the size of America's top two cash crops, corn and soybeans. The nation produces 40 percent of the world's corn and the crop is estimated to sink 37 percent. Soybeans should be down 23 percent.
Only the winter wheat crop, which matured just as the drought intensified, remained untouched. The spring and durum wheat crops, grown in the hard-hit Northern Plains, were cut in half to 266 million bushels, according to the department's monthly crop report.
The report was issued just hours after President Reagan signed into law a $3.9 billion drought relief measure to give disaster payments to farmers who lose more than 35 percent of a crop.
"Today's reports confirm that the drought has had a major impact on this year's crops," said Assistant Agriculture Secretary Ewen Wilson. "But because of large pre-season stocks, total supplies are enough in most cases to assure an adequate food supply at home, satisfy foreign customers and meet our food aid commitments."
Even with a small crop this year, the United States should have a three-month supply of corn when next year's harvest starts, Wilson explained. The crop is now forecast at 4.48 billion bushels.
"The impact would be catastrophic," however, if the country sees a similar drought next year, Wilson said. Fortunately that prospect is unlikely.
According to the government, soybeans are expected to come in this year at 1.47 billion bushels, the smallest crop since 1976; the overall wheat crop should be at 1.82 billion bushels, the smallest since 1978.
The barley crop is estimated at 287 million bushels; cotton is seen at 14.9 million bales; rice is forecast at 152.5 million hundredweight and oats are expected at 206 million bushels - the smallest crop in more than a century.
Corn, wheat and soybeans are the three major U.S. crops. Wheat, the chief food grain, is used in bread, pastries and bakery goods while durum wheat is used in pasta. Corn is used mainly in meat production but also for food and by industry. Soybeans are fed to livestock as well as used in food products.
Wilson said the department is maintaining its estimate of a one-point change in the Consumer Price Index for food because "we have fairly large supplies of food grains" in reserve. He noted, "We came into the year with large supplies of feed grains for livestock."
In Chicago, a panel of grain traders agreed with the prediction that drought-reduced crops would have only marginal effect on consumer prices.