Crop Marketing Issues

Michael Salassi  |  9/16/2008 12:08:48 AM

After more than two weeks of poor weather from Hurricanes Gustav and Ike, Louisiana is assessing the impacts on agriculture and the effects are quickly adding up. Heavy rains and winds have caused significant damages to crops in some areas, and are expected to bring significantly smaller yields and increased harvest costs. As Louisiana farmers continue to harvest their crops, a true representation of the damage caused will be seen, as it is difficult to estimate damage because of weather.

There are several issues that are compounding the problems for damaged crops. In some areas, crops have been damaged more severely than in others and harvest will be far more costly than normal. These damaged crops will also have lower yields and may cause problems with the ability to fulfill contracts. Many farmers will have to assess their crops to see how much crop will be able to be salvaged and whether the harvest cost will outweigh the returns. For those who are able to harvest their crops, damage will decrease the value of the commodity, and in some cases not be purchased by elevators because the commodity does not meet the quality commitment agreed to in the contract. Unfortunately, damage to many of these commodities will not be seen until they have been harvested and additional costs have been incurred.

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