|Illinois Corn (courtesy of Randy Wick on Flickr)|
"U.S. feed grain supplies for 2011/12 are projected lower this month with sharp drops in forecast corn and sorghum production. Corn production for 2011/12 is forecast 556 million bushels lower with a reduction in harvested area and lower expected yields. The national average yield is forecast at 153.0 bushels per acre, down 5.7 bushels from last month’s projection as unusually high temperatures and below average precipitation during July across much of the Corn Belt sharply reduced yield prospects." (click here for the latest report at USDA)
USDA Corn Projections (8/11)
And then on 8/26/2011 (last Friday), the 2011 Pro Farmer Tour estimated that corn yields would be even lower at 147.9 bushels per acre (12.484 billion bushels).
"Pro Farmer pegs 2011 U.S. corn crop at 12.484 billion bushels; average yield 147.9 bu. per acre +/- 1% = 146.45 bu. to 149.4 bu. per acre; 12.36 billion to 12.61 billion bushels."
"NOTE: Pro Farmer editors believe USDA will eventually lower harvested acres for both corn and soybeans, but USDA’s Aug. 1 harvested acreages were used in making these estimates...." (continue reading at Agweb.com/profarmer)
So that explains the strength in corn recently. Below are charts of the Corn ETF and future (ZC), and then links to articles. You can see how the Corn ETF broke out earlier this month and ZC is close to testing the June high. Also, the U.S. Dollar is testing June, July and August support. If it rolls over here it could test the May lows (72.70). Will the euro zone debt crisis ever affect the Euro? EUR/USD is currently trading at 1.45.
Corn Future ZC (courtesy of Finviz.com)
Teucrium Commodity Trust Corn Fund (CORN) (Courtesy of Stockcharts.com)
Estimates for US corn harvest cut (Financial Times)
Pro Farmer 2011 Corn, Soybean Crop Estimates (AgWeb.com/ProFarmer)
UPDATE 2-Pro Farmer sees U.S. corn yield below USDA's 147.9 vs. 153 (Reuters)
Hot Summer Erodes Corn, Soy Harvest (Bloomberg)
Traders 'race' to cut US corn yield estimates (Agrimoney.com)
A reduced corn yield forecast (DesMoinesRegister)
Wall Street Goes Down on the Farm for Real Dirt (WSJ)