July 4, 2006

 

Hot weather in US may diminish corn and soy yields

 

 

Although the US is expected to have its third-largest harvest of corn and soy this spring, hot and dry weather may change all that, analysts said.

 

Forecasts of impending hot weather suggest that yields would be average or below average.

 

Growers planted 79.37 million acres (32.1 million hectares) of corn and 74.93 million acres (30.3 million hectares) of soy, USDA said in its annual Acreage report.

 

Contrary to expectations of increased corn planting due to higher demand from ethanol, corn plantings went down 3 percent from last year while soy plantings are up 4 percent from 2005.

 

USDA's figures for likely yield and harvest area indicate there would be 10.7 billion bushels of corn and 3 billion bushels of soy. If it materialises, this would have been the third largest harvest on record.

 

Forecasts of hot weather, which would diminish harvests, have given more impetus to rising prices, Chicago analysts said.

 

Record high soybean yields in 2005 and high input costs this year have caused farmers in a few states to shift to soy.

 

990 million bushels of soy were in storage on Jun 1, fueling expectations of a record-large surplus this year.

 

Corn stocks totaled 4.363 billion bushels, about the same as a year ago.

 

Corn, wheat and soybean futures opened higher at the Chicago Board of Trade thanks to USDA plantings figures and weather concerns.