Weather, be it too much rain, too little rain, drought and even an occasional tornado, continues to be the dominant factor shaping commodity prices.
The latest addition to the list is flooding in the Missouri River Valley and DTN Senior Analyst Darin Newsom noted similarities -- and distinctions -- this week between the spring of 2011 and that of 2008.
According to Newsom, corn prices rose early in 2008 due to spring flooding along the Mississippi River. But that year, there also were ample grain reserves. This year, he says with beginning corn supplies pegged at 730 million bushels and ending stocks-to-use ratios estimated at a razor-thin 5.4 percent, there is no margin for error. And he says any threat to production is much more newsworthy than in 2008.
But, the weather-related news garnering most of the headlines again this week focused on the impact of a deadly tornado in Joplin, Missouri.
Missouri officials this week raised the death toll from the massive May 22 Joplin tornado to 138 people. The state Department of Public Safety announced the increase on Thursday after confirming that four more people died in hospitals of injuries suffered in the deadliest single U.S. tornado since 1950. More than 8,000 homes and apartments, and more than 500 commercial properties, were damaged or destroyed when the twister ripped through more than six miles of the southwest Missouri town.
Meanwhile weather continues to wreak havoc across other parts of the nation as flooding from the Missouri River looms in Eastern Montana and the Dakotas. In the past few weeks alone, the Upper Missouri Basin has received nearly a year's worth of rainfall. South Dakota's governor has urged some residents to evacuate from three cities considered early trouble spots as officials brace for a prolonged period of Missouri River flooding.
Normally, farmers in the Missouri River bottomland would be finishing spring planting, but many are forced to move their equipment and household goods to higher ground because of the rising floodwaters.
The U.S. Army Corps of Engineers, faced with massive snowmelt and spring torrential rains, plans to let a record amount of water out of reservoirs along the Missouri River upstream of Iowa. Flows are expected to be double the 1997 record at Gavins Point Dam in South Dakota.
The Missouri River bottoms are flat, and their rich soils annually produce 200 to 220 bushels an acre of corn. If underwater for more than two or three days, corn will drown.
Corn prices rallied on the weather concerns as did soybeans which exceeded the $14 per bushel.
And in the eastern Corn Belt, the excessive rainfall has caused some farmers to abandon all hope of planting. In Ohio, corn was 19 percent planted, compared to 93 percent the same time last year. Meanwhile, only seven percent of soybeans were planted compared to 62 percent one year ago.