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Farmers Turn Wild Habitats Into Corn Fields as Crop Prices Rise

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Aug. 6 (Bloomberg) -- Farmers turned more than 23 million acres (9.3 million hectares) of wild habitats into corn, soy and wheat fields since 2008, as crop prices and subsidies rose, according to a report by an environmental group.

Texas, South Dakota, Iowa and Nebraska were the top states for switching grasslands and wetlands to crops, according to a report today by the Washington-based Environmental Working Group that analyzed satellite data from the U.S. Department of Agriculture.

Exports, ethanol production and cattle-feed demands have pushed up demand for corn, the largest U.S. crop, and with it corn prices. Soybean and wheat prices increased along with that of corn.

U.S. farmers were forecast to plant 96.4 million acres of corn this year, the most since 1937, USDA said June 29. Surging demand and unusual weather in 2011 left U.S. corn stockpiles at a 16-year low and kept prices at their highest annual average ever.

Corn futures for December delivery dropped 0.6 percent to $8.03 a bushel on the Chicago Board of Trade today. The price gained 27 percent last month, as a drought intensified in the nation’s Corn Belt.

The Environmental Working Group said government-subsidized crop insurance is distorting farmers’ decisions and inducing them to plant on “marginally productive land,” according to the 12-page report.

Grassland replaced by crops threatens the swift fox and puts at risk species such as the sage grouse, the lesser prairie chicken and the whooping crane, according to the report, citing USDA data.

To contact the reporter on this story: Mark Drajem in Washington at mdrajem@bloomberg.net

To contact the editor responsible for this story: Steve Geimann at sgeimann@bloomberg.net

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