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Corn Price Falls on Record Crop Forecast

15:44PM May 09, 2014
down markets

Corn dropped Friday after the government forecast a record crop for this year.

The price of corn for July delivery fell 9 cents, or 1.7 percent, to $5.08 a bushel.

The loss pared this year's gain for corn to 20 percent. The price of the grain has climbed this year as planting was delayed by unseasonably cool weather in the U.S. and on concern that corn exports from Ukraine would fall due to tensions with Russia.

U.S. farmers are forecast to produce 13.9 billion bushels of corn this season, according to the Department of Agriculture's forecast. The government is predicting that higher crop yields will offset a reduction in the number of acres of corn that are planted. The report also said that corn production globally would remain at record levels.

"Wheat and corn supplies may be tight here in the United States, but between what we're growing now and what will be grown around the world, that supply tightness will be alleviated,"said Mike Zuzolo, president of Global Commodity Analytics and Consulting.

Wheat prices also fell after the report.

July wheat fell 12.75 cents, or 1.7 percent, to $7.23 a bushel. Soybeans for July rose 17.50, or 1.2 percent, to $14.87 a bushel.

Metal prices were mixed.

Gold for June was little changed from Thursday at $1,287.60 an ounce.

July silver fell 1.7 cents, or 0.1 percent, to $19.12. Palladium for the same month fell $8.20, or 0.6 percent, to $1,429.90 an ounce. Palladium for June dropped $4.30, or 0.5 percent, to $799.75.

Copper for July rose two cents, or 0.7 percent, to $3.08 a pound.

In energy trading, the price of oil fell 27 cents, or 0.3 percent, to $99.90 a barrel.

Wholesale gasoline fell 0.9 cents, or 0.3 percent, to $2.90 a gallon, heating oil dropped 1.3 cents, or 0.5 percent, to $2.91 a gallon. Natural gas fell 4 cents, or 0.9 percent, to $4.53 per 1,000 cubic feet.