By Andi Anderson
Corn futures fell below $4 per bushel this week, marking the lowest level in nearly 11 months. The drop came as favorable U.S. weather boosted crop prospects and traders anticipated strong yield estimates in an upcoming government report. Although prices recovered slightly above $4 by Wednesday’s close, they remain under pressure.
As of Thursday morning, corn futures were trading around $4.04 per bushel. Analysts note that recent estimates from market sources are already higher than the U.S. Department of Agriculture’s (USDA) record forecast of 181 bushels per acre set in July.
StoneX recently predicted yields could reach 188.1 bushels per acre, a figure that could further weigh on prices when the USDA updates its outlook on August 12.
Good rainfall and moderate temperatures have helped the crop, though some farmers report pollination problems in certain areas. Analysts suggest that, without a major weather issue, prices may remain steady or trend lower through late August.
Large global wheat supplies and reduced Chinese purchases of U.S. crops are also adding pressure.
Market experts say farmer selling is another factor, as producers clear out old stocks before harvest or make sales ahead of key contract dates. This added supply has widened basis levels in some regions.
If national yield estimates climb into the mid-180s, total production could exceed 16 billion bushels, pushing ending stocks above 2 billion. Historically, such supply levels have been associated with corn prices closer to $3.50 per bushel.
Only about 5% of the new crop is currently priced, leaving around 15 billion bushels unpriced. Analysts warn this could further pressure markets during harvest.
Overall, abundant supply expectations, slow export demand, and ongoing farmer sales are creating a challenging environment for corn prices, with the August USDA report expected to play a key role in determining future market direction.
Photo Credit: getty-images-elhenyo
Categories: Illinois, Crops, Corn