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Corn is facing the worst crop conditions in two decades and the next two weeks will be critical in determining the size and quality of the U.S. crop.
The outlook is particularly difficult since expectations just a few weeks ago were for an early, bumper crop that would provide a record number of bushels and high level of corn in stock.
But unusual heat and lack of rain across the heart of the Midwest corn belt threatens this year’s crop yield and has put a fire under futures prices. Higher corn prices affect everything from cereal to sweeteners to animal feed and the ethanol in gasoline.
Corn for December delivery jumped more than 3 percent Wednesday morning to a new nine-month high, after Tuesday's 5 percent gain took it to $6.24 per bushel. The price for new crop corn futures has jumped about 24 percent since the first of the month and 14 percent this week alone.
“We need some good, soaking rains within the next 10 days, or we really are talking some yield reductions,” said Randy Mittelstaedt, director of research at RJ O’Brien.
While other grains are also impacted, Dennis Gartman of the Gartman Letter points out that the corn crop is most at risk.
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