Commodities Corner: Corn prices to dropCommodities Corner: Corn prices to drop

John T.

In its first look at the 2012-2013 corn crop, the U.S. Department of Agriculture projected next year’s crop at a record-large 14.27 billion bushels — up 15.5 percent from 2011-2012. Corn ending stocks will double to 1.6 billion bushels. Most important, the USDA forecast next season’s average corn price to drop from $6.20 in 2011-2012 to just $5 per bushel for 2012-2013. In the meantime, corn supplies will remain tight — and prices are expected to remain high — until the 2012 crop is harvested. Drought-driven supply losses in South America will add additional demand for U.S. exports this year, and Chinese buying on any significant market dips has supported prices. Corn futures, at $3.58 per bushel March 6, have traded in the $6.27 ...