I notice that on Fri. there was active trade in corn futures with the Sept. contract increasing 3.9%.
According to the following WSJ article a leading crop forecaster cut the yield estimate for the upcoming harvest to less than the USDA's prediction.
Berry, Ianm, 2010. Corn prices hit 23-month high. The Wall Street Journal, Sept. 4.
In general, I think many are weary about the ability of the USDA to accurately predict the size of the corn crop. With a huge shortage of the wheat harvest in Russia, the world grain supplies might be tighter than anticipated. Supply forces look to drive up prices.
I found the following quote from the above article interesting:
"The forecast reaffirmed the emerging view that this year's crop will be smaller than first expected. A soggy summer flooded low-lying areas of many fields and washed away nitrogen, a crucial nutrient for corn, raising questions about the quality of the overall harvest. Hot night-time temperatures also have deprived the crop a chance to develop properly."
Through new approaches to spatial sampling being developed at the MIT Field Intelligence Lab, I think that the rain and nitrogen issue can be modeled, yielding better crop forecasting methods.
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