Corn futures have soared, crop condition ratings have dropped, and the world is hearing about risks of U.S. drought driving food prices higher.
Voice of America warned yesterday that world food prices likely will spike for the third time in five years, noting that price surges in 2007-08 and 2010-11 "triggered riots and social instability in dozens of countries around the world."
The Sydney Morning Telegraph said Australian consumers can expect to pay more for many foods in response to Midwestern U.S. crop damage and reported "demand for Australian grain is surging, pushing the price up for local users too."
And in Europe, analysts at Offre & Demande Agricole said deteriorating prospects for U.S. corn plus reduced Black Sea grain production have driven up prices ahead of the July 11 USDA reports on supply and demand, and may keep pushing prices higher.
December Chicago Board of Trade corn futures yesterday surged 37 cents to settle at $7.30, up nearly $1 in a week. The July contract climbed 32 cents to $7.75 ¼, up more than $1 in a week.
Yesterday afternoon, USDA rated only 40% of the corn crop in the 18 major corn-producing states in good to excellent condition, down from 48% the previous week, In those 18 states, 30% of the crop rated poor to very poor, compared with 22% the previous week.
Sixty percent or more of the crop rated poor to very poor in Indiana, Kentucky, Missouri, and Tennessee.
'Average Year' in Minnesota
Even in Minnesota, where 77% of the crop rated good to excellent this week, University of Minnesota Agronomist Jeff Coulter took a cautious view of the crop.
"It looks okay," said Coulter of the state's corn crop. "I think it's going to be an average year."
Tassels started to appear last week on early-planted corn.
"Last week we had really hot temperatures," said Coulter. "I don't think it affected pollination too much on early-planted corn. That corn has a pretty good root system."