Wednesday, April 2, 2008

Corn Battles to Break the $6 Barrier

Corn prices couldn't break through the $6 price handle today, even though new all-time record highs, and new all-time closing highs (for a front month contract) were both reached. Eventually, they will, especially if rainy weather forecasts continue for the grain growing regions of the United States. This would make corn planting less likely, but might also increase the likelihood of more soybean acreage (too bad, however, that soybean seeds are also in short supply this spring). I wouldn't be at all surprised if the $6 handle was broken during overnight trading tonight, especially since the day session ended so close to its highs for the session. Fundamentals for all the grains remain bullish, based upon tight world supplies, continued political unrest in South America, rainy growing conditions, and (once again) a weakening US Dollar. One of my favorite news sources even suggested that we may have already seen the low prices for all the grains for the entire growing season. He thought that prices would go nowhere but up from here.