Quantcast
Get breaking news alerts via email

Click here to manage your alerts
Lower corn and soybean output sends prices surging
Commodities » Poor weather combines with higher demand.
First Published Jan 12 2011 04:33 pm • Last Updated Jan 12 2011 08:02 pm

Des Moines, Iowa • A surprising drop in the U.S. corn and soybean crop sent grain prices surging to their highest levels in 2½ years Wednesday. The price increases stoked concerns about higher food prices and tighter supplies of feedstock for food and biofuels.

Wet weather and abnormally high temperatures contributed to lower U.S. corn production in 2010, according to a report from the U.S. Agriculture Department. The report also showed declines in soybean, wheat and grain sorghum production.

Join the Discussion
Post a Comment

March corn futures jumped 4 percent to settle at $6.31 a bushel. Soybean prices jumped 4.3 percent to $14.15 a bushel.

The report confirmed traders’ fears that historically low stockpiles of grain and oilseeds could leave little buffer in coming months as demand rises with a growing global economy. Prices reached their highest points since the financial crisis of 2008 caused a collapse in global demand for food and fuel.

It can take months for higher grain prices to work their way to the grocery store. Raw ingredients are just a fraction of the cost for processed foods.

But companies like Hormel Foods Corp. have already announced price increases of more than 3 percent this year. Higher grain costs will put more pressure on them to pass costs along to consumers.

U.S. corn production dropped 5 percent in 2010 to 12.4 billion bushels. Still, it remained the third-highest output on record. The record was set in 2009, when 13.2 billion bushels of corn were harvested.

At issue is the amount of grain being carried over from year to year. That surplus creates a buffer for global markets. The report shows that corn stockpiles are among the lowest levels ever recorded, at just 5 percent of the total corn used, said Chad Hart, an Iowa State University grain marketing specialist.




Copyright 2014 The Salt Lake Tribune. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Top Reader Comments Read All Comments Post a Comment
Click here to read all comments   Click here to post a comment


About Reader Comments


Reader comments on sltrib.com are the opinions of the writer, not The Salt Lake Tribune. We will delete comments containing obscenities, personal attacks and inappropriate or offensive remarks. Flagrant or repeat violators will be banned. If you see an objectionable comment, please alert us by clicking the arrow on the upper right side of the comment and selecting "Flag comment as inappropriate". If you've recently registered with Disqus or aren't seeing your comments immediately, you may need to verify your email address. To do so, visit disqus.com/account.
See more about comments here.
Staying Connected
Videos
Jobs
Contests and Promotions
  • Search Obituaries
  • Place an Obituary

  • Search Cars
  • Search Homes
  • Search Jobs
  • Search Marketplace
  • Search Legal Notices

  • Other Services
  • Advertise With Us
  • Subscribe to the Newspaper
  • Access your e-Edition
  • Frequently Asked Questions
  • Contact a newsroom staff member
  • Access the Trib Archives
  • Privacy Policy
  • Missing your paper? Need to place your paper on vacation hold? For this and any other subscription related needs, click here or call 801.204.6100.