Saturday, January 13, 2007

USDA Releases Crop Report

USDA released their latest crop report Friday with corn recording it's 3rd largest crop in history. Soybeans farmers produced the largest crop in US history with a 2% increase over the record 2004 crop season.

Kevin Goode of farmpolicy.com wrote an excellent article summarizing the various thoughts of analysts around the country. The general conensus seems to be that the markets reacted positively as demand for ethanol and foreign exports are keeping demand strong and are using up US corn inventories.

The Associated Press also provided this summary of market action today, “Ethanol plants and
foreign buyers are gobbling up the nation’s corn supplies, pushing prices as
high as $3.40 a bushel, the U.S. Department of Agriculture said
Friday.
“Farmers haven’t seen prices this high - a range of $3 to $3.40 a
bushel, according to the new crop forecast - for more than a decade. That’s up
10 cents from December.
“Robust prices have made corn more expensive as a
feed for livestock.

It would seem that the american corn crop is going to demand a strong price into the near future.

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