September 22, 2010

US corn futures rise on fears of output missing forecasts

Corn rose for the eighth time in nine sessions as early harvest results fuelled concern that production will fall short of forecasts in the US, the world's largest grower and exporter.

The USDA cut its forecast on September 10 by 1.5% to 13.16 billion bushels after unusually hot, dry weather in August damaged crops already stunted by too much rain in June. An estimated 18% of the crop was harvested as of September 19, up from the average of 10% in the previous five seasons, the USDA said.

Corn futures for December delivery rose 8.5 cents, or 1.7%, to US$5.1675 a bushel at 10:51 a.m. on the CBOT. Before today, the grain rose 9.9% since September 8. Earlier, the most-active contract touched US$5.2375, the highest price since September 2008.

Earlier, the price fell on speculation that increased harvesting will overwhelm immediate demand for US supplies. Mostly dry weather beginning September 24 will aid harvesting the next two weeks, according to reports.

Corn is the biggest US crop, valued at US$48.6 billion in 2009, government figures show.