Wednesday, August 10, 2022

$12 Corn: Outrageously Possible

by

The following is portion of an article from Agriculture.com.

By Mike McGinnis

  • For $12 market, drastic crop damage needed
  • Historic commodity prices support $12 corn discussion
  • Farmers urged to watch gross dollars not wait for $12 corn
  • Rationing keeps corn from $12 level, analyst says

At this year’s Commodity Classic conference, at least one market-watcher suggested that a hiccup in the spring/summer crop-weather, causing reduced yields, would cut further an already 15-year low U.S. corn stocks supply, sending corn futures prices marching towards $12 per bushel.

Meanwhile, some CME Group floor traders have figured that, adjusted for inflation, it’s not unrealistic to believe corn should be closer to the $10.00-$12.00 range vs. $6.00-$7.00 per bushel.

As of this week, the July corn futures contract, the one that would see a $12 price first, traded within a $7.70-$7.72 range. So, is it really possible for the corn market to reach $12.00 per bushel?

Currently, a much slower-than-average planting season is raising eyebrows among traders and analysts. Plus, wet and cool weather conditions forecast for the Midwest through April are perhaps building further arguments for a significant corn market rally.

David Hightower, The Hightower Report co-owner, says corn and soybeans both have support to run sharply higher.

“We have to put this $12 corn price into context. As they relate to alternative fuels, with energy prices running higher, this pushes up corn and soybean prices.”

CLICK HERE to be directed to the rest of this article.

Source:  Agriculture.com

Posted by Haylie Shipp

 

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