Corn prices seen rising
Corn prices seen rising
Corn traders are bullish for a fifth consecutive week on speculation that dry weather in South America is damaging crops, boosting demand for U.S. supplies at a time when stockpiles are predicted to shrink to a 16-year low, Bloomberg reported.
Nineteen of 25 traders surveyed by Bloomberg expect corn prices to advance next week. Lower-than-average humidity and dry soil will curb crop development in Argentina and southern Brazil through at least Jan. 7, according to T-Storm Weather LLC, a forecaster in Chicago. Argentina is the world’s biggest corn shipper after the United States and typically starts harvesting its grain in March.
Prices doubled in the past two years as record demand eroded inventories, but corn has fallen as much as 27 percent since the end of August, in the face of predictions for the biggest-ever global harvest. The grain rallied 10 percent in the past two weeks on mounting concern that bad South American weather will undermine that prediction and drive stockpiles lower.
“We have already caused irreversible damage to the corn crop,” said Dave Marshall, a farm marketing adviser at Toay Commodity Futures Group LLC in Nashville, Ill. “The dry weather trend of the past five weeks probably already lowered production 5 to 7 million tons below the USDA forecasts.”
Corn traders are bullish for a fifth consecutive week on speculation that dry weather in South America is damaging crops, boosting demand for U.S. supplies at a time when stockpiles are predicted to shrink to a 16-year low, Bloomberg reported.
Nineteen of 25 traders surveyed by Bloomberg expect corn prices to advance next week. Lower-than-average humidity and dry soil will curb crop development in Argentina and southern Brazil through at least Jan. 7, according to T-Storm Weather LLC, a forecaster in Chicago. Argentina is the world’s biggest corn shipper after the United States and typically starts harvesting its grain in March.
Prices doubled in the past two years as record demand eroded inventories, but corn has fallen as much as 27 percent since the end of August, in the face of predictions for the biggest-ever global harvest. The grain rallied 10 percent in the past two weeks on mounting concern that bad South American weather will undermine that prediction and drive stockpiles lower.
“We have already caused irreversible damage to the corn crop,” said Dave Marshall, a farm marketing adviser at Toay Commodity Futures Group LLC in Nashville, Ill. “The dry weather trend of the past five weeks probably already lowered production 5 to 7 million tons below the USDA forecasts.”
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