Floodwaters receding into the Mississippi River and its tributaries will suck billions of dollars out of the Midwest’s economy, though experts have not agreed on whether the damage will be as devastating as the 1993 flooding.
The impact on U.S. economic growth is expected to be small, but it is difficult to make accurate estimates because water still stands over farm fields, roads and in many homes.
Federal and state agriculture officials say the real damage won’t be known until after the fall harvest. A report due on July 7 from the Department of Agriculture should give the country its first glimpse of the damage to the corn and soybean crops.
The Farm Bureau has pegged Iowa’s agricultural losses alone at roughly $3 billion, while Indiana agricultural officials estimate the state’s losses at $800 million. Experts say it’s too soon to even estimate the losses in Illinois and Missouri, which also are big corn- and soybean-growing states.
Some Ohio farmers who thought their harvest would suffer because corn and soybean planting was delayed by wet spring weather say at least they will have a crop.
Preble County farmer Alan Vondehaar raises corn, soybeans and wheat and says he feels fortunate that his planting was only delayed.
Randall Reeder, an Ohio State University Extension agricultural engineer, says flooding elsewhere has inflated corn prices $2 per bushel, while soybean prices are up $3 per bushel. He says there’s no doubt that Ohio farmers will benefit from the disaster hitting farmers elsewhere.
Overall, the effects of snagged barge and freight traffic, and insurance claims by water-logged homeowners and businesses, will likely add billions to the financial toll.
All told, the natural disaster will deliver a serious but manageable blow to the U.S. economy, which is already beset by high food and energy prices, falling home prices and a tight credit market that is making people and businesses cautious about spending, economists said.
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