Weather Threats Send Corn Price Higher

July 30, 2010 02:27 PM
It’s been a roller coaster ride for December corn, says Jerry Gulke of the Gulke Group. “We started the rally at $2.30, made it to $4.10 and retraced that run 50% to $3.76. That got some people nervous,” he says. 
“Then weather expectations began to shift. Where two days ago, forecasts were for generally favorable weather—hot and wet the first two weeks of August—now it is supposed to be hot and dry,” says Gulke. “We’re likely going to be combining in the third week of September, so we’re just two months out. Given the accelerated maturity, these warm nights could mean that kernels don’t fully fill and end up shallow. That will reduce yields from earlier expectations. So it’s not a perfect year all over.”
Now, a close over $4 could indicate another leg up. “I’d err on the side of caution selling,” says Gulke. “I won’t get more than 40% sold—and you almost have to do it in futures because my basis is -50¢ or -55¢. I have to believe it will improve from that level. That’s one of the benefits of grain bins—I can wait it out.”
Looking at soybeans, Gulke notes there’s a chance of flower abortion if the hot, dry weather materializes. “Meanwhile, North Dakota is too hot for ideal canola weather, and there’s a shortage of that crop worldwide.”  

Back to news


Spell Check

No comments have been posted to this News Article

Corn College TV Education Series


Get nearly 8 hours of educational video with Farm Journal's top agronomists. Produced in the field and neatly organized by topic, from spring prep to post-harvest. Order now!


Market Data provided by
Brought to you by Beyer