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Forecast: Outlook for Corn in 2010

January 31, 2010 at 21:38 by Vladimir Vyun

Corn
Corn is the most widely grown crop in the United States. 332 million metric tons of the crop are harvested annually in the U.S. What prospects are for the corn in 2010?

By the end of 2009 future seemed to be bright for corn prices as adverse weather caused late planting in the U.S. But everything has turned upside down when the U.S. Department of Agriculture predicted that US corn production will reach a new record. USDA estimated 2009 corn crop as much as 13.15 billion bushels, while analysts forecast yield to be about 12.82 billion bushels. U.S. corn exports forecast went down by 50 million bushels to 2.1 billion bushels, further pushing down outlook for corn prices. U.S. exporters also have to deal with competition from Argentinean corn. Production of corn in Argentina may reach 17 million bushels, compared with estimated 12 million bushels, and at least 9 million bushels will be available for export. Slow recovery of U.S. economy does not help demand, and therefore prices, either.

Yet not everything looks dim for corn. Low prices improved exports by 20 percent this month. Recent reports about low soil moisture in Argentina corn growing areas are also supportive for corn prices. As you see, conditions can change significantly over small amount of time, making hard to say which price should be expected. USDA forecasted the price for the corn to be in a range of $2.90-$4.50 per bushel, suggesting with such a wide range that Department is unsure too. Analysts say that “there are not many fundamental reasons for high corn prices” and “technical support should not allow prices to fall much more”.

If you have any questions or comments about the future trading for the Corn, use the form below to reply.

4 Responses to “Forecast: Outlook for Corn in 2010”

  1. mded

    Palm oil also affected heavily by corn price

    [Reply]

  2. Vladimir

    Hello,

    Does anyone know how corn prices in the US and South America affect prices in Europe, as America is the biggest produces of corn in the world amounting to 88% of all corn production I guess the price must be affected a lot by the american prices.

    Thank you,

    [Reply]

    enivid Reply:

    Corn is an exchange-traded commodity the prices are pretty coupled in different parts of the world – the same as with oil traded in NY and London.

    [Reply]

    Vladimir Reply:

    Thank you for your reply!

    I was also going to ask you in case you know where can I obtain information about ‘corn hybrid prices’ and how does corn prices affect hybrid prices. I am talking about the hybrid seeds that farmers plant.

    Thank you!

    [Reply]

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