Minnesota Corn Crop Healthy, Ahead of Schedule

While many of the nation's corn states are struggling because of the ongoing drought, northern states like Minnesota are doing very well, with the corn reportedly growing far ahead of the normal schedule for the state.

At this time in the state the corn height is usually about 12 inches tall at best. But on average it's about 23 inches tall at this time, and will be much more by the Fourth of July, where it's usually not even at the 23 inches it now stands. With a couple of weeks left till July 4, it could reach 30 inches, or maybe even a little higher.

Most of this is based upon Minnesota farmers planting their corn seed earlier than in the past, which accounts largely for the increased growth. The weather has cooperated well too, helping to boost growth.

What's even more important is farmers in Minnesota have planted the largest amount of corn in the history of the state, and so the harvest should be bountiful.

At this time it's too early to know whether that's good or bad news, as the drought in other areas of the country are positive for the price of corn, but the weak global economy, along with strong yields in parts of Brazil could end up with a supply glut, which would over the year put downward pressure on the price of corn.

Interestingly, approximately 17 percent of corn farmers in Minnesota are now concerned about there being too much water, as the region has been drenched lately, according to the USDA. Others say the moisture is exactly what they need.

At this time the USDA says that about 82 percent of the corn crop in the state is in good or excellent shape.

U.S. Corn Prices Schizophrenic on Drought, Economy

The price of corn futures went up and down the last several days as disparate forces pressure the grain from different sides.

First there is the force pushing the price of corn down, which is the ongoing global recession, which has been trying to pull the price of corn to lower levels.

Countering that is the continuing drought, which is now expected to last into July in some important parts of the country, which has turned a number of traders bullish on it.

Around the world the global economy has been floundering, as China reported another decline in its manufacturing sector, the eighth straight month for them. Europe's economy has dropped for the fifth month in a row, and U.S. manufacturing is growing at a declining pace.

So the price of corn in the U.S. is largely based upon this competing influences, where in the short term it appears the weather may have the largest influence; although that has been changes on a daily basis at times.

Another factor that hasn't been taken into account by many is the major corn crop in Brazil’s Mato Grosso state, which could end up boosting the supply glut even more. If so, that would put downward pressure on corn in the near future.

At this time it appears over the next two or three weeks the weather may be the biggest factor in corn futures prices, which means we may see it go up during that time.

Beyond that it's likely the economy and corn production will be the determining factors, which means corn prices will drop as the summer rolls on.

Of course it depends on the weather over time, and whether some important corn production areas in the Midwest get some pockets of rain.

Corn for December climbed to $5.51-1/4 a bushel, jumping $0.23 percent, on the Chicago Board of Trade.

Corn Futures Jump on Hot, Dry Weather in U.S.

Soaring temperatures and little rain in the Midwest of the United States has resulted in corn futures climbing to their highest levels in a month, as concerns over whether or not the harvest will be big enough to replenish corn inventories is weighing on the global market.

On Tuesday the corn futures for December jumped 29-1/2 cents to settle at $5.63-1/2 a bushel, a gain of 5.5 percent. It rose as high as $5.64 on the day, the highest level in 3 months.

Corn for December delivery has increased by 11 cents on the week so far.

The major forces driving the prices higher from an investment standpoint has been the commodity funds, which have acquired approximately 40,000 corn contracts over the last couple of days, implying they are bullish on corn at this time.

On Monday the U.S. Department of Agriculture reported the condition of corn was worst than expected, with current weather forecasts suggesting it could get worse. Meteorologists say the bad conditions could last for another couple of weeks in the region.

According to the USDA, 60 percent of the corn crop in the United States is rated from good to excellent condition. That was a drop of three percent from the prior week, and a percentage point less than expected.

With about 5 percent of the corn in the U.S. starting to silk, which means it's entering it's reproductive state, the ongoing poor weather conditions during that stage could have a major effect on yields.

The corn yield in the U.S. for 2012 was estimated to reach 166 bushels an acre by the USDA. Private projections have it at about 160 bushels an acre.