CHICAGO: After an extremely worrisome start that fanned fears of famine and economic devastation, the most crucial American crop is now on track for a bountiful harvest, the government said Tuesday. The U.S. Department of Agriculture is forecasting the second-highest corn yield on record with production of 12.3 billion bushels, nearly 600 million bushels more than it anticipated earlier in the summer. "We dodged a bullet," said Bill Nelson, a grains analyst for Wachovia. As cool weather in April and downpours in May gave way to extensive flooding in June, prospects seemed dim for corn, which in recent years has increased in importance as the government has mandated that ethanol, made from corn, be added to gasoline. Food groups went to battle with ethanol interests, saying there was not enough corn for both food and fuel. Corn futures prices reached $7.50 a bushel, triple the price of a few years ago. Some analysts worried that $9 or even $10 a bushel was a real possibility, a price that would have been ruinous to livestock producers and ethanol plants alike. Then nature began, finally, to cooperate. In the American Midwest this summer, the weather has been exactly what the young corn stalks needed to thrive. "Not too hot, not too cold, not too wet, not too dry," Nelson said. Corn, which has been falling for weeks, was trading Tuesday at a little over $5 a bushel. The highest corn yield on record was 160.4 bushels an acre in 2004. The new 2008 estimate of 155 bushels an acre is up 3.9 bushels from last year. Actual production will still be lower than last year's, because farmers planted fewer acres. Soybean production is slightly more of a question mark, since it was planted this year even later than corn. The government is forecasting 2.97 billion bushels, down about 30 million bushels from earlier forecasts. That, too, is much better than many feared in June. Soybean futures reached a high of more than $16 a bushel at the beginning of July. On Tuesday, they were trading at about $12. Despite the improved prospects for the crops, and thus lower prices for feed, livestock producers were not in the mood to celebrate. "Given that ethanol is continuing to divert an ever larger share of our corn supply away from feed and food, even a harvest like the one predicted by USDA may not be enough to prevent continued food inflation and to avoid additional harm to family farmers who raise meat and poultry," Joel Brandenberger, president of the National Turkey Federation, said in a statement. Farmers are not banking on any good news until after the harvest. And a late start means a late harvest. The government yield estimate of 155 bushels is a dream to some of them. Dan Meinhart, a farmer in Effingham, Illinois, said the prospects in his area did not reflect the government's optimism. Meinhart had to replant nearly all his corn and beans after the rains washed them away. He is expecting a corn yield of 130 bushels. "Spanish needles are blooming already, and the old-timers say that means it will frost in six weeks," Meinhart said. "We need at least eight to 10 weeks to get the crop in."