Emiko Terazono reported today at The Financial Times Online that, “Grain bulls continued their retreat after much-needed rainfall in the US Midwest increased prospects of a bumper corn harvest…[T]he price for new harvest corn has tumbled more than 20 percent since this year’s high of $4.44 a bushel last month, with CBOT September corn trading at $3.47 a bushel on Wednesday.”
The FT article noted that, “The latest crop development report from the US Department of Agriculture also added to the bearish sentiment around corn, with the proportion of crops rated as being in good or excellent condition at 75 percent, unchanged from a week before.”
Meanwhile, Bloomberg writers Megan Durisin and Jeff Wilson reported yesterday that, “Some investors had speculated that U.S. farmers would choose to plant more soybeans instead of the grain after a rally for the oilseed. Instead, U.S. government data showed that growers sowed the third-biggest corn crop since World War II. The improving weather is also boosting the outlook for production as plants enter the pollination period.”
And University of Illinois agricultural economist Darrel Good pointed out yesterday at the farmdoc daily blog (“Weekly Outlook: Corn Prices Face Strong Headwinds“) that, “Prospects for another year of low corn prices and negative returns to corn producers have two implications. First, producers will need to continue to look for ways to reduce production costs. Second, some reduction in world corn production may be required to move prices back to profitable levels. With prospects for increased acreage in Argentina and a rebound in yields in Argentina, Brazil, and South Africa in 2017, the reduction may fall to the U.S.”
