Corn Futures Recent Decline

Corn futures have taken a steep drop recently. December corn has fallen 46 cents since it reached $3.85 per bushel on September 27th. As a result, U.S. cash corn prices have dropped below the $3 per bushel mark for the first time since late July.


One reason is the spillover from wheat and soybean futures as these two commodities have been rapidly declining. Today, December wheat dropped 30 cents (limit-down) to $8.60 per bushel while November soybeans fell 15 cents to $9.25 per bushel. Escalating crop production estimates have also assisted in corn's recent decline. Last Monday, FC Stone estimated the U.S. corn crop at 13.455 billion bushels which eclipsed the USDA's September estimate of 13.308 billion bushels. On Friday, Informa Economics raised the bar to 13.506 billion bushels. In addition, last Monday's crop progress report was very optimistic. It was reported that 31% of the U.S. corn crop was harvested, up from the five-year average of 20%. The next crop progress report will be released tomorrow at 4:00 P.M. eastern time.

Ethanol producers are reaping the benefits:

Below are the prices VeraSun has paid for its corn within this timeframe:

VeraSun Plant Corn bids
Aurora Plant
Fort Dodge Plant
Charles City Plant
September 27th
$3.35 $3.39 $3.34
September 28th
$3.21 $3.26 $3.20
October 1st
$3.17 $3.22 $3.19
October 2nd
$2.97 $3.02 $2.99
October 3rd
$2.93 $2.98 $2.95
October 4th
$2.90 $2.95 $2.94
October 5th
$2.94 $2.95 $2.94
October 8th
$3.00 $2.93 $2.95


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