Plunging prices for some of the most widely grown crops in the world is stirring concerns that a slowdown in trade in basic ingredients of most foods is harming food makers, consumers, and farmers.
For many agricultural producers in the Midwest, the last few months have been tough. Higher prices for fuel and fertilizer have squeezed already tight profit margins. However, there are signs that things are starting to look up.
This year, prices appear to be on the cusp of a new rally. Analysts said that corn and wheat futures rallied last week and could continue a late-December rally. The biggest worry is that the decline and return of severe weather that can hurt crops will continue to interrupt trade routes and hurt commodity prices.
According to the USDA Crop Progress report released today, almost all of the corn grown in the United States has been planted. This represents an increase from the five-year average of 97%. According to USDA, the crop rating fell 1% from last week to 72% good/excellent, lower than the trade estimate of a 1% to 2% increase. 88% of soybeans have already been planted, according to the USDA. In contrast, last week’s result was 78%, and the five-year average was 88%.In contrast, last week’s result was 78%, and the five-year average was 88%.
In the last 24 hours, July corn has been trading in a 24¢ range and is currently down 10¢. Descriptive statistics for December corn show the price is down 8 cents. Soybean prices have been trading in a range of 55¢ this month and are currently down 40¢. Soybean prices for November are 49¢ lower. Since last week’s sell-off and following U.S. winter wheat reports, prices have recovered to mid-$4s.