Weather is also a factor in the grain belt. But there it seems to be promoting larger yields. A nearly ideal spring has allowed farmers to get seed in the ground in a timely fashion. And more recently, ample soaking rains have ensured germination and emergence.
The prospect of bumper crops has not escaped the notice of grain merchandisers and processors. Indeed grain and oilseed prices are already trading at levels usually not seen until the glut of harvest.
The price prospects for farm country remain gloomy. Corn prices have plummeted to contract lows 6 of the past 9 weeks pushing nearby contracts well under two-dollars a bushel. With favorable weather in the forecast, plenty of moisture in the ground, and 70 percent of the corn crop rated good to excellent, a bull market is unlikely to develop soon. On the upside, some analysts are predicting a steady demand for corn, especially if the market sustains current price levels.
The soybean market has seen some upward movement. Brazil and Argentina are noting brisk export sales of soybeans and are anticipating limited supplies at summer's end. That is good news for U-S producers who are dedicating a record number of acres to soybeans and soon will finish planting.
(slug: wheat harvest)
Harvest has begun on the beleaguered winter wheat crop. But, sixty-one percent of the crop is rated fair to very poor as a result of dry conditions. The poor crop is helping wheat make some gains in futures trading pits. And price prospects could continue to improve if dry conditions persist in wheat producing areas of China and Australia.
American cotton producers say the market for their crop is being saturated by fiber grown abroad.
Furthermore growers in much of cotton country are worried about water availability this year. And growers in California are nervous about the cost of energy to pump the water into fields if it is available.