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Mississippi Overflows Levees, Crops Threatened

Sectors:Food and Beverage

By: Reuters | 18 Jun 2008 | 08:50 PM ET

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The swollen Mississippi River ran over the top of at least 12 more levees on Wednesday, as floodwaters swallowed up more U.S. farmland, adding to billion-dollar losses and feeding global food inflation fears.

Sue Ogrocki / ASSOCIATED PRESS

Volunteers and aid workers were piling sandbags up and down the most important U.S. inland waterway to try to protect more levees and thousands of acres of prime crop land threatened as the river's crest moves south after last week's torrential rains.

About 10 levees were breached earlier this week, bringing the total to 22 on Wednesday. The levee breaches lowered the river level by letting water spill onto the surrounding land.

"Their misfortune had been our fortune. I'd rather it hadn't come at the expense of others. But it is what it is," said Steve Cirinna of Iowa's Lee County Emergency Management Agency.

Across the river at Dallas City, Illinois, about 50 sandbaggers made up of volunteers and National Guard troops were busy working ahead of the expected river crest overnight.

"We've had a little relief because the levee breaches lowered the river level a little. But it's coming up again. We're not done yet. This evening will be critical," said Kathy Dougherty of the Hancock County Emergency Services Agency.

The slow-rolling disaster, the worst flooding in the Midwest in 15 years, has swamped vast sections of the U.S. farm belt and forced tens of thousands of people from their homes.

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The cost of the disaster may end up rivaling that of 1993 Midwest floods that caused more than $20 billion in damage and 48 deaths. This month's flooding has caused few deaths, with Iowa hardest hit. But the damage has yet to be fully assessed.

The prospects of smaller crops have already jolted commodity markets, food producers and exporters. Chicago Board of Trade corn prices traded at a record $8.07 a bushel.

The floods will mean more food inflation, not only for U.S. consumers, but also for dozens of countries that buy American grain. The United States exports 54 percent of the world's corn, 36 percent of its soybeans and 23 percent of its wheat.

River Flooding Moves South

LeRoy Lippert, chairman of emergency management committee for Des Moines County, Iowa, said volunteers and aid workers in the town of Burlington filled 2.5 million sandbags in the past week before the river crested.

"All systems are holding right now. We're in a watch and wait mode with our levees. The situation has stabilized in the last 24 hours," Lippert said. "The best news is that we're not getting any rain, that would be utterly devastating if we got heavy rain now."

The National Weather Service said scattered thunderstorms were forecast for Wednesday night in western Iowa, although severe weather was not expected.

The Army Corps of Engineers, which operates river locks and dams, said 22 levees along the Mississippi had failed with the latest levee breaks near Meyer, Illinois, near St. Louis, Missouri and just north of Quincy, Illinois.

"They were lower level agricultural levees," said St Louis district Corps spokesman Alan Dooley.

The Corps has identified 48 levees protecting more than 285,000 acres of cropland from Dubuque, Iowa, to St Louis that were already under water or at high risk of flooding.

Among the most fertile farms in Iowa and Illinois have land that lies in the Mississippi River's vast flood plain.

"Some of the richest farmland is to be found between the river and the bluff and we aim to protect it," said Lippert.

Estimates are that 5 million acres across the Midwest have been ruined and will not produce a crop this year.

Iowa and Illinois usually produce one-third of all U.S. corn and soybeans. Expectations of reduced crops from the main sources of livestock feed, renewable fuels like ethanol, starch and edible oils has sent commodity prices to record highs.

"We continue to get news of more acreage losses because of the flooding and that continues to support the market," said Mario Balletto, Chicago-based grains analyst for Citigroup.

The worst flooding has struck Iowa but evacuations have also affected flooded sections of Indiana, Wisconsin, Illinois, and Minnesota. More than 2,000 National Guard troops and hundreds of prisoners from state facilities have been activated in Illinois, Iowa and Missouri for flood-fighting efforts.

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