June Washington D.C. Preview

As gas prices to food costs hit record highs at the onset of the summer season, Pro policy teams take a look ahead at what to expect in the coming months as inflation rages on — and prices continue to rise.

QUICK FIX — The Federal Reserve has rolled out aggressive interest rate hikes to fight inflation, and the central bank has indicated that summer may bring even more increases.   — As high gas prices continue to break records almost daily, inflation has also caused the price of natural gas to spike.   — President Joe Biden laid out a plan to fight inflation in a recent Wall Street Journal op-ed, which included tax increases and more robust tax collection efforts.

FINANCIAL SERVICES Fed eyes rate hikes to fight inflation: The Federal Reserve, the nation's chief inflation-fighting authority, is engaged in a campaign of aggressive interest rate hikes to try to tamp down price surges. Its plans have already led to drops in the stock market and higher bond yields, but the central bank will be watching job openings, the housing market and inflation data to see how effectively it is turning the tide. This summer could bring at least two additional half a percentage point increases, and the Fed will also continue efforts to shrink its $9 trillion bond holdings, which have already helped increase longer term rates like mortgages. The Fed will meet June 15. — Victoria Guida   Housing costs fuel inflation: The cost of shelter, one third of the official inflation gauge, is the single biggest driver of rising prices — and there’s no sign housing costs will come down anytime soon.   Mortgage rates, meanwhile, have risen at the fastest pace in 40 years, putting already-expensive housing out of reach for many would-be buyers. It’s already hurting sales: New-home sales fell 16.6 percent from March to April.   Economists expect housing price growth to moderate as a result, with several forecasters expecting home prices to be up about 5 percent for the year by the end of 2022. That’s a far cry from the 19 percent growth seen in 2021, but little comfort to Americans struggling to afford the cost of housing.   Construction costs, meanwhile, are up significantly — raising concerns that builders will begin to pull back despite a historic shortfall in the supply of homes to meet demand. All of it is putting pressure on rents, currently up over 15 percent from a year ago. — Katy O’Donnell

ENERGY Energy prices are expected to continue rising through summer before tapering off and are all but certain to contribute to the inflation headaches that will be a political liability for Democrats heading into elections in November.   Oil production in the United States has steadily increased since energy companies significantly reduced operations two years ago in response to cratering demand due to the Covid pandemic. The Biden administration has repeatedly asked companies to raise production, something that has drawn fire from environmental groups concerned about the climate impact. But oil production still lags behind 2019 output as companies focus on returning money to investors and tread carefully on developing new projects.   Meanwhile, most of Europe will soon stop taking deliveries of Russian crude to end their indirect funding of Russia’s invasion of Ukraine. That will increase the EU’s imports of oil from other sources, driving up prices, though that may be tempered if China takes more Russian crude and turns away from non-Russian sources, analysts have said.   After heavy pressure from the Biden administration, OPEC+ also decided to increase its production in July and August. But the cartel’s announcement failed to pressure prices and did not win over lawmakers on the Hill.   U.S. fuel making capacity has also become a bottleneck as refinery closures have caused production capacity to shrink to levels last seen in 2014.   Besides the cost increase in road fuels, inflation has also caused the price of natural gas to spike. That will eventually add to the general inflation atmosphere as natural gas is used to produce fertilizers, plastics and other goods.   Drivers have not yet made noticeable changes in their driving habits despite gasoline prices reaching all-time nominal highs. Prices are below the inflation-adjusted highs seen in 2009 and are only now reaching consumers’ pain threshold as a percentage of their disposable income. Electric vehicles have seen an uptick in sales, but remain too expensive to be accessible for many drivers, though at least one automaker has recently dropped its prices.   High inflation is expected to continue through the summer driving season, normally the most travel-laden time of the year as people go on vacation. Households are signaling that they may shorten or cancel travel plans, however, and some economists have forecast that higher prices in general could cause the economy to start slowing down, which would reduce fuel demand and rein in energy prices. — Ben Lefebvre

EMPLOYMENT AND IMMIGRATION Inflation spurs workforce development overhaul: Democrats are scrambling to patch the workforce development system as a means of reinforcing its supply chain and keeping inflation from spiraling further.   With nearly two job openings for every worker seeking employment in April, economists say one reason for the mismatch is a failure to effectively prepare workers for in-demand roles. Many of the shortfalls are in sectors particularly crucial to a healthy supply chain, including trucking, manufacturing, railroads and ports.   The Labor Department is working to expand apprenticeships in careers along the supply chain, including by its recent creation of a pilot program to recruit and train more truck drivers.   And House Education and Labor Chair Bobby Scott (D-Va.) is leading a push to reauthorize the Workforce Innovation and Opportunity Act, which funds the bulk of the federal government’s 43 employment and training programs. The House passed Scott’s legislation, which would boost funding to $74 billion over six years, last month.   What happens next is less certain: Republicans are unhappy with the measure, which Democrats rolled out on their own following a failure to reach agreement on funding levels — and union sway — among other things.   Democrats’ stalled reconciliation package would also invest in training. The $1.7 trillion “Build Back Better” package contained $20 billion for workforce development. Almost $14 billion would have gone to the Labor Department for programs like apprenticeships. More than $6 billion would have been reserved for Education Department efforts, including $5 billion to run community college programs that partner with businesses.   But the future of that legislation is cloudy at best. Negotiations between major players in the Senate have yet to bear fruit.   The COMPETES Act also contains workforce development provisions, including language that would make more programs eligible for financial aid under the Pell Grant program. Employers say these are critical to making sure chip manufacturers and others have the labor they need. The legislation has passed both the House and Senate, and lawmakers are now working out differences between the two versions. — Eleanor Mueller

TAX Tax away inflation? Among the prescriptions Biden laid out for fighting inflation in a recent Wall Street Journal op-ed were tax increases and more robust tax collection efforts.   “The Internal Revenue Service should have the resources to collect taxes that Americans already owe. We should level the international taxation playing field so companies no longer have an incentive to shift jobs and profits overseas. And we should end the outrageous unfairness in the tax code that allows a billionaire to pay lower rates than a teacher or firefighter,” Biden wrote.   All of that would reduce the deficit, which, in turn, would “help ease price pressures,” he posited.   But tax experts caution it’s unlikely to be a quick fix, even if it were possible.   “While Biden is focused on tax hikes on the wealthy and corporations to reduce the deficit, the most direct way to use taxes to slow inflation would be to raise levies on low- and moderate-income households, whose spending habits are most sensitive to changes in incomes,” Tax Policy Center Senior Fellow Howard Gleckman wrote in an analysis on the group's website.   But that would violate Biden’s pledge not to raise taxes on anyone making $400,000 or less — and certainly be a nonstarter with his fellow Democrats.   “What about raising taxes on businesses?” Gleckman wrote. “Remember, today’s inflation is caused by a mix of high demand and an unusually low supply of goods. It is hard to see how raising taxes on goods producers would increase the supply of those products.”   In his op-ed, Biden noted that controlling inflation is primarily the job of the Fed. And Gleckman said the president might be wise to heed that.   “Maybe the right answer is the usual one: Given enormous geopolitical and economic uncertainties and a slow-to-react Congress, the hard work of responding to high inflation should be left to the Fed, not tax policy,” he wrote. — Toby Eckert

DEFENSE Congress looks to inflate Pentagon budget: How best to address rising costs for the military will be a central debate when the House and Senate Armed Services committees consider their annual defense policy bills starting this week.   Republicans, and some Democrats, are pushing for a significant increase to Biden's $773 billion Pentagon proposal. Concerns that runaway inflation could eat away at the funding increases lawmakers approved in recent years are driving the push to boost the Pentagon budget.   GOP defense hawks have called for a 5 percent increase above inflation over the current year's level.   Pentagon leaders aren't entirely opposed to more money to tackle inflation. Defense Secretary Lloyd Austin and other top officials have acknowledged that inflation has outpaced the projections made when the budget was constructed.   Still, expect the administration to push back on efforts by Congress to use a larger topline to purchase more expensive weapons the Pentagon didn't request. — Connor O'Brien

HEALTH CARE Inflation’s mixed bag for health policy: Inflation has an unexpected upside for Medicare actuaries. High inflation is good for Medicare Part A, which sets rates for hospitals based on expected inflation. Last year, those rates were much lower than actual inflation turned out to be, which helps hold down costs and is one reason the Medicare Trust Fund is expected to last two years longer than previously thought.   It doesn’t hurt that a scorching hot labor market and rising worker wages means more tax revenue than anticipated, which helps fill the Medicare coffers.   But inflation also presents one more challenge for Democrats hoping to revive any parts of Biden’s social spending package. Sen. Joe Manchin (D-W.Va.), whose vote is key to any Senate deal, has warned for months about rising inflation, citing it as a reason to pare down Democrats’ $1.7 trillion proposal.   His resistance means Democrats, who have talked for years about cutting the cost of prescription drugs, face the possibility their majorities will go home empty handed, imperiling their majorities.   Sen. Maggie Hassan (D-N.H.), an endangered incumbent, said her goal is to “hold Big Pharma accountable and bring down prescription drug costs,” though an agreement to do so has proven elusive. — Dan Goldberg

EDUCATION Students feel the pinch of the pump: Even though school is largely out for the summer, college students planning to take summer courses face steep gas hikes that could hurt their commutes to campus. Southwest Tennessee Community College President Tracy D. Hall announced it would have virtual classes on Fridays through Aug. 12 as a cost savings measure for students and employees.   “Our students and employees, like the rest of the nation, are facing historic inflation numbers and increasing gas prices,” Hall said in a statement. “We are concerned about their welfare and how they may be impacted by this increased cost of living.”   Student loan debt relief won’t help: While the White House mulls its options for sweeping student loan forgiveness, student debt relief would have a “pretty small” impact on inflation, according to National Economic Council Director Brian Deese. And the economic impact of such a proposal would “be across the course of years, or a couple of decades.”   Deese said the economic impact of any loan forgiveness would depend on how the White House structures the program and when the Biden administration will resume monthly student loan payments that have been frozen since March 2020. — Bianca Quilantan

CANADA Red hot and rising: Canadians are dealing with decades-high inflation that has been fueling affordability fears. Price growth, which hit 6.8 percent in April, is poised to keep accelerating. To try to bring the runaway inflation under control, the Bank of Canada delivered a second-straight supersized interest rate hike last week of 50 basis points. The central bank has been spending a lot of time admitting it underestimated the strength and staying power of the price pressures.   A day after the most recent rate increase, Deputy Gov. Paul Beaudry warned inflation is likely to move even higher in the near term before beginning to ease. The bank is worried the longer inflation stays above 3 percent the greater the risk people will expect prices to continue climbing. Such a scenario could make price growth self-fulfilling, he said.   “History shows that once high inflation is entrenched, bringing it back down without severely hampering the economy is hard,” Beaudry said. The bank is now widely expected to deliver another extra-large rate hike at its next meeting on July 13. The big question is whether the increase will be 50 basis points — or possibly even 75. — Andy Blatchford

CANNABIS Inflation exacerbates access woes for medical marijuana patients: Medical marijuana is legal in 37 states, but because cannabis is federally illegal, it isn’t covered by health insurance. While many Americans pay small co-pays for prescriptions, they’re subject to the whims of the market when shopping for medical marijuana — even when recommended by a doctor. While the price differs dramatically from state to state, affording medical marijuana can be an insurmountable financial burden for some, often costing hundreds of dollars per month.   For patients with conditions like debilitating seizures, marijuana is a potentially life-saving plant, one they cannot give up despite inflation. Even so, there is no federal plan to address this issue. No bill has been introduced to require insurance companies or government-run health programs to cover medical marijuana. Until marijuana is removed from the Controlled Substances Act, patients will continue to pay out of pocket for medical marijuana. — Natalie Fertig

Bureau of Reclamation, Pacific Northwest Region - Storage Reservoirs in the Upper Snake River (6/6)

Average daily streamflows indicated in cubic feet per second.
Reservoir levels current as of midnight on date indicated.

Upper Snake River system is at 58 % of capacity.
(Jackson Lake,Palisades, Grassy Lake,Island Park,Ririe,American Falls,LakeWalcott)
Total space available:	1685377 AF
Total storage capacity:	4045695 AF

Friday Market Watch

 LIVESTOCK:

Friday ended on the positive note for the cattle contracts, but not for the lean hog market. Come Monday, the live cattle market will be watching see if traders still favor pushing the market higher and feeders will be closely eyeing the corn market. Hog prices closed $3.13 loads on the Daily Direct Afternoon Hog Report with a weighted average of $112.09 on 3,480 head. 

From Friday to Friday, livestock futures scored the following changes: June live cattle up $1.42, August live cattle up $1.45; August feeder cattle up $7.55, September feeder cattle up $7.00; June lean hogs down $0.20, July lean hogs down $0.97

Friday's slaughter is estimated at 126,000 head, 6,000 head more than a week ago and year ago. Saturday's slaughter is projected to be 96,000 head, 71,000 head more than a week ago and 3,000 head less than a year ago. This week's slaughter is estimated at 603,000 head, 41,000 head less than a week ago but 59,000 head more than a year ago.

Beef net sales of 17,900 mt for 2022 were down 11% from the previous week and 17% from the prior four-week average. The three largest buyers were Japan (6,000 mt), China (4,800 mt) and South Korea (2,700 mt).

Boxed beef prices closed higher: choice up $0.61 ($267.26) and select up $0.39 ($250.02) with a movement of 88 loads (52.82 loads of choice, 11.54 loads of select, 12.21 loads of trim and 11.61 loads of ground beef). Throughout the week choice cuts averaged $267.22 (up $3.17 from a week ago) and select cuts averaged $249.30 (up $4.39 from a week ago) and the week's total movement of cuts, grinds and trim totaled 509 loads.

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GRAINS:

July corn closed down 3 1/4 cents and December corn was down 4 1/4 cents. July soybeans closed down 31 1/2 cents and November soybeans were down 14 3/4 cents. July KC wheat closed down 22 1/2 cents, July Chicago wheat was down 18 1/4 cents and September Minneapolis wheat was down 8 cents. 

For the week:

July corn closed down 50 1/4 cents and December corn was down 40 cents. July soybeans ended down 34 1/2 cents and November soybeans were down 17 cents. July KC wheat closed down $1.14 1/4, July Chicago wheat was down $1.17 1/2 and September Minneapolis wheat was down $1.11 1/4.

DAIRY:

MILK

Weather in the Midwest has been cooler which is keeping cows comfortable and feed intakes high. However, milk production seems to have peaked indicating spring flush may be finished. Milk in the Northeast continues to show some gains, but the pace is slowing as well. Other areas are holding steady. More milk is moving to manufacturing from school accounts and will continue to do so for the next few months. May Class III milk price set a new record. Depending on the level of demand the rest of the year, that record could also be broken. However, there is concern high prices in grocery stores may result in some slowing of demand, maybe not so much for milk, but for other dairy products. Milk production in New Zealand is projected to be down 4.3% for the 2021-22 season. Overly wet weather in some areas and drought in others has had a significant impact on production.

AVERAGE CLASS III PRICES

3 Month:	$24.45
6 Month:	$24.26
9 Month:	$23.86
12 Month:	$22.06

CHEESE

For the week, blocks declined a penny with 5 loads traded. Barrels declined 5 cents with 15 loads traded. Dry whey gained 3.50 cents with 2 loads traded. According to the April Dairy Products report, American cheese production totaled 465 million pounds, down 2.7% from April 2021. Italian type cheese output reached 489 million pounds, up 1.2% from the previous year. Total cheese production totaled 1.16 billion pounds and 0.1% above a year earlier. Dry whey production totaled 82.8 million pounds which was 7.0% higher than a year ago. Lactose production increased 2.8% totaling 101 million pounds. Whey protein concentrate declined 1.1% totaling 45.0 million pounds.

BUTTER

For the week, butter gained 3.75 cents with 27 loads traded. Grade A nonfat dry milk price increased 0.25 cents with 10 loads traded. Butter production in April totaled 181 million pounds, down 1.0% from April 2021. Nonfat dry milk production totaled 196 million pounds, an increase of 1.0% from a year ago. Skim milk powder totaled 35.6 million pounds. This was down 36.5% from April 2021.

LATEST HAY MARKET REPORTS - HERE

OUTSIDE MARKETS:

The June U.S. Dollar Index is trading up 0.36 at 102.19. July crude oil gained $2.00 closing at $118.87 per barrel. The DOW fell 349 points closing at 32900 while the NASDAQ fell 304 points closing at 12,013. June gold is down $19.90 at $1,851.50, July silver is down $0.36 at $21.92 and July copper is down $0.0835. July heating oil is up $0.0706, July RBOB gasoline is up $0.0556 and July natural gas is up $0.017.

This Week's Drought Summary (6/2)

Heavy precipitation fell across much of the contiguous U.S. over the past week, particularly in the Great Plains, Northwest (especially the northern Rocky Mountains), and the Southeast. Much of this fell as rain, though some mountain snows occurred as well. Meanwhile, the Southwest remained dry, along with northern Montana and most of the Texas Panhandle. Improvements to drought conditions were widespread in the Great Plains, with parts of central Kansas seeing two-category improvements to conditions. Despite the widespread precipitation, drought remained in most of the western Great Plains and western U.S., though it lessened in severity in some areas. A mix of worsening and improving drought conditions occurred in the Southeast and Mid-Atlantic states. Long-term drought improved in northern Maine along the Canadian border, while short-term drought expanded in coverage in southern New England. Short-term abnormal dryness and moderate drought developed in south-central and southwest Alaska. Heavy rains in Puerto Rico led to localized improvements there.

Northeast

After a wet week in northern Maine, long-term moderate drought lessened in coverage, as did the surrounding abnormal dryness area. Here, long-term precipitation deficits continued to lessen, leading to the improvements, as some areas near the Canadian border saw over 2 inches of rain. Farther south in New England, short-term moderate drought and abnormal dryness expanded in coverage in Massachusetts, southeast New Hampshire, eastern Connecticut, and Rhode Island. Here, short-term precipitation deficits continued to mount, alongside lowering streamflow and soil moisture values, leading to the worsening conditions. Moderate short-term drought was also removed from southern West Virginia after recent rainfall improved conditions there.

Southeast

Widespread heavy rain fell over parts of the Southeast region this week. The Florida Panhandle and Alabama saw some of the highest totals, with much of Alabama receiving 2 or more inches of rain, and the western Florida Panhandle receiving 2 to 6 inches. Heavy rain amounts also fell in western North Carolina and surrounding areas, leading to widespread removal of abnormal dryness. After recent rainfall improved conditions, moderate short-term drought was removed from western Virginia. Moderate and severe drought continued in coastal parts of North Carolina, South Carolina, and parts of the Georgia coast, which did not receive as much rainfall. Changes to drought status were mixed in the Florida Peninsula, with areas that received heavier rain seeing improvements, while east-central Florida saw an increase in moderate drought coverage as short-term precipitation deficits and soil-moisture deficits mounted.

South

Widespread drought conditions continued in western portions of Oklahoma, Texas, southern Texas, and southern Louisiana this week, though some improvements were noted in Texas and Oklahoma. Recent heavy rainfall from far northern Oklahoma into parts of south-central Oklahoma and west-central and central Texas lessened precipitation deficits enough to allow for improved drought conditions. The ongoing drought area over western Oklahoma and the eastern Texas Panhandle is now long-term, reflecting the impact of recent rain events. Tuesday night’s thunderstorms in the Southern Plains was not accounted for on this week’s map, as it fell after the Tuesday morning cutoff. This will be considered for next week’s map. Despite recent rainfall, problems continued with winter wheat and cotton growth in the southern Great Plains. Finally, a small area of short-term drought in southeast Tennessee was removed after heavy rain this week.

Midwest

The Midwest region remained mostly free of drought this week, aside from northwest Iowa, though some pockets of abnormal dryness saw changes. Severe thunderstorms in western Iowa and Minnesota dropped enough rain to lead to improvements to some areas of abnormal dryness along the western Iowa/Minnesota border. Heavy rain in northern Illinois and southern Wisconsin lessened long-term precipitation deficits, which allowed for the ongoing abnormal dryness area to be trimmed on its north and south edges. Short-term precipitation deficits mounted in southeast Illinois, where abnormal dryness increased slightly. Short-term abnormal dryness also developed in northwest Indiana, where short-term precipitation deficits mounted alongside groundwater concerns. Abnormally dry conditions generally stayed the same or improved in Kentucky after rainfall this week in parts of the state.

High Plains

Large-scale improvements to drought conditions and abnormal dryness took place in the High Plains region this week, where widespread rain and mountain snow fell as several storm systems moved through the region. Extreme drought was removed from central Kansas and northeast Nebraska, where soil moisture improved and short- and long-term precipitation deficits lessened. Widespread improvements were also made in South Dakota, where precipitation deficits improved. Rain and mountain snow was also widespread in Colorado recently, leading to improving conditions in both the Rocky Mountains and high plains. Heavy precipitation amounts fell in northern Wyoming and southern Montana, leading to a large swath of improved conditions. Lingering long-term abnormal dryness in western North Dakota also continued to wane, while moderate drought was removed entirely from the west end of the state after precipitation this week. Despite the improving drought conditions, agricultural problems continued in the region. Winter wheat harvest potential in Kansas was reduced by over 25%, while conditions are too wet in parts of Montana and the Dakotas for planting spring wheat.

West

Localized heavy precipitation fell across mainly the northern half of the West region this week, leading to a few areas of improvements. Drought areas in southwest and northeast Oregon, central Idaho, northern Nevada, and northern Utah saw some local improvements as drought indices responded to recent precipitation. As mentioned in the High Plains section, widespread improvements were made in southern Montana after heavy precipitation fell there, with localized amounts of 5 inches or more. Recent precipitation also allowed for some improvements in northeast Montana. Despite these improvements, widespread severe, extreme, and some exceptional drought continued across the West. Impacts from the widespread drought include reduced grazing for cattle in New Mexico due to wildfire closures in national forests and hydropower production concerns at reservoirs in Nevada and California due to very low water levels.

Caribbean

Widespread short- and long-term abnormal dryness and moderate drought continued this week in Puerto Rico, though some minor improvements were made in the western half of the island, where widespread heavy rain fell.

The U.S. Virgin Islands have been in a pattern of prevailingly subnormal rainfall since at least August 2021. After a very dry September-December 2021 throughout the Virgin Islands, rainfall totals increased, especially across the northern tier, including St. Thomas and St. Croix. February-April ended up a few inches wetter than normal, but dryness returned with a vengeance in May 2022. All three sites received less than an inch of rain. St. Thomas received about 0.88 inch, or about 30 percent of normal, making it the driest month since January 2021 (0.75 inch). Even so, they fared better than St. John and St. Croix, which only got 0.45 and 0.35 inch, respectively (both about 10 percent of normal). Overall, St. John and St. Thomas were severely dry for the last 4 months of 2021, but experienced significant improvement with slightly above-normal rainfall prevailing in 2022 until things dried out in May. As a result, conditions generally improved, though with September – December 2021 being much drier than normal and January-April only modestly wetter than average, these locations could see quick drought intensification if rainfall doesn’t pick up significantly through the summer. At this point, the exceedingly dry May following a modestly wet January-April has left St. Thomas and St. John in moderate drought (D1) but with the potential for drought impacts to ramp up quickly.

Farther south In St. Croix, however, conditions are markedly worse. Only February 2021 brought substantially above normal rainfall, and while it remained damp farther north, Monthly totals in St. Croix were under an inch in March, and remained that low in April and May. These months typically bring about 7.5 inches of rain to St. Croix, but this year only 1.7 inches were reported, less than 25 percent of normal.

Looking back farther, long (multi-month) periods of well below normal precipitation have been common since well before the last four months of 2021, when severely dry conditions were widespread across the Virgin Islands. Looking back to September 2019, . , and date back before August 2021 unlike in other parts of the Virgin Islands. prevailed more frequently and for longer periods of time. Of the 33 months from September 2019 through May 2022, only 6 ended up wetter than normal. St. Croix received about 66 inches of rain during this period, which is 38 inches less than normal. So in the past approximately 2.5 years, St. Croix has missed out on a normal year’s worth of precipitation. If you look back farther, to March 2018, a span of 51 months, only 7 were wetter than normal, and the accumulated shortfall from normal is almost 54 inches. The island is classified as extremely dry (D3) now, and may drop to our most intense drought classification (exceptional drought (D4)) soon if rainfall doesn’t increase significantly.

Pacific

Moderate drought was introduced and abnormal dryness expanded in south-central and southwest Alaska this week, where snowmelt has occurred early amid warmer temperatures, which combined with short-term precipitation deficits to worsen conditions. The worsened conditions may also lead to increasing wildfire threat and increasing need for watering vegetation.

Due to above-normal rainfall for May, abnormal dryness was removed from Kauai and Niihau. Meanwhile, short-term extreme drought expanded on Maui, where pastures have become completely de-stocked.

Abnormal dryness continues in all the reporting locations in the Mariana Islands (Guam, Rota, and Saipan). But farther south, broad stretch of islands reaching from Palau eastward across Micronesia and the Marshall Islands are predominantly free of impactful dryness. The only exceptions are in the south and east fringes of this area.

Moderate drought (D1) covers Kapingamarangi, which is well south of the other islands across Micronesia. Acutely dry conditions have prevailed for the last 3 weeks, and they may be primed to deteriorate quickly if rainfall doesn’t markedly increase soon. Meanwhile, Wotje – on the eastern edge of the U.S.-affiliated territories – is also in moderate drought (D1). But unlike Kapingamarangi, Wotje is slowly improving. Impacts are slowly easing, prompting the improvement from severe drought (D2) last week.

Palau has a very wet climatology, with an annual average rainfall near 150 inches. Even so, they’ve managed to top their normal in each of the last 6 months. With over 24 inches falling in May, their 6-month total increased to over 97 inches, compared to a normal of about 67 inches. Dryness is not even remotely a concern at this time.

The same as last week, all 3 locations reporting locations in the Marianas Islands (Guam, Saipan, and Rota) are experiencing some degree of abnormal dryness (D0). These islands need approximately an inch of rainfall a week (4 inches per month) to keep pace with human and natural demand. After 3 months of suboptimal rainfall, totals picked up significantly in April, seemingly ending the dry spell. But conditions got drier again in May. The roughly 1.5 to 3.0 inches reported for the month was even lower than the monthly totals for January-March.

With the dramatic exception of Kapingamarangi, rainfall has been sufficient to meet needs across the central and northern tiers of Micronesia. At some point, most sites experienced a few weeks to a couple months of suboptimal rainfall, but these tended to be short-lived, and impact – if any – were mild and of short duration. February 2022 was one of the drier months recently, with about half of the reporting sites falling short of the optimal rainfall total (about 8 inches). In contrast, April brought an abundance of widespread rainfall. None of the observing sites received less than the preferred 8 inches, including even Kapingamarangi.

But sufficient rainfall has been far less common in Kapingamarangi than in islands farther north. The mean annual rainfall is about 128 inches, and of the 17 locations for which we have reliable historic monthly data in Micronesia, this puts Kapingamarangi near the middle of the pack. But for a few years now, extended periods of significantly below normal (and suboptimal) rainfall have affected the island, including May-December 2020, when each of the 9 months brought less than 45 percent of normal rainfall, which is well below the amount needed to keep pace with demand. In September 2020, only 9 percent of normal fell. Rainfall has been up and down since then with periods of adequate precipitation interspersed with periods of acute dryness. August – November 2021 was another period where each month brought well under half of normal rainfall, and at best half of the amount needed to keep pace with demand. Rainfall significantly increased over the ensuing 3 months, with monthly precipitation totals more than enough to meet demand. But in March a drier pattern again began to prevail. Most weeks have brought less than the 2 inches needed to keep pace with the water budget. And conditions have taken a sharp downturn since early May. Rainfall was just 10 percent of normal for the month, and the last 3 weeks have been almost bone dry. If rainfall doesn’t increase significantly soon, conditions could go downhill quickly.

The frequency and duration of periods with suboptimal rainfall (below 8 inches) started to occur more frequently in the Marshall Islands starting near the beginning of 2021. But as in Micronesia, these were not extreme and did not last long enough to raise significant concerns. The only exceptions were on the eastern fringes of the region – in Maduro and especially Wotje. As May 2022 ended, increasing precipitation ended impactful dryness on Maduro, with reservoir levels returning to near normal after a few months of low stores. But Wotje is still experiencing the effects of significantly suboptimal rainfall. Even under the best circumstances, Wotje is more vulnerable than most other U.S.-affiliated islands because the normal rainfall is relatively low (about 58 inches), so significant impacts can develop and worsen more quickly than most areas, where rainfall is in greater abundance. This was noted during a spell of substantially below normal precipitation during December 2021 – March 2022. A total of 5.15 inches of rain was measured when normally almost 10 inches would fall. Drought was most severe during January-February 2022. Normal rainfall for the 2 month period is about 4 inches, but this year, a grand total of 0.05 inches fell. Precipitation increased significantly during April and May, but were still dry enough to engender only slow improvement. However, each week since May 4-10 brought the preferred amount of rain to keep pace with demand, and slow improvement is continuing.

For the last 3 months, below normal rainfall has prevailed over American Samoa. March – May typically bring about 33 inches of rain, but only 20 inches was measured in 2022. So far, optimal rainfall totals have been observed for enough weeks to stem any significant impacts, and May saw an uptick in rainfall totals, though amounts weren’t quite as much as they’d like.

Looking Ahead

Through the evening of Monday, June 6, the National Weather Service Weather Prediction Center is forecasting moderate precipitation amounts in parts of the Northwest, with some mountainous areas forecasted to see over an inch of precipitation. Dry conditions are expected to continue in the Southwest. Widespread rain exceeding one-half inch is expected to have fallen across northern Texas, including parts of the Panhandle, and much of Oklahoma. Elsewhere in the Great Plains, some precipitation is forecast to fall from southwest North Dakota southward, with amounts generally varying between 0.25 and 0.75 inches. Heavier amounts are possible along the Minnesota/Iowa border. In the eastern U.S., generally drier conditions are expected, though some parts of the Ohio Valley and Northeast and the Appalachians are expected to receive at least a half-inch of rain. Finally, a tropical disturbance is forecast to move across southern Florida, which may deliver rain amounts from 3 to 10 inches, especially across the southern half of the Florida Peninsula. For the latest on this system, please refer to forecasts from your local National Weather Service office and any advisories from the National Hurricane Center.