Iowa Public Television

 

Rain falls, so do grain prices

posted on June 2, 2000


FORECASTERS SAY THE PARCHED MIDWEST RECEIVED BETWEEN ONE AND TWO INCHES OF RAIN THIS WEEK. COMBINED WITH SLOWLY WARMING TEMPERATURE READINGS, THE RAIN PROVIDED NEAR PERFECT GROWING CONDITIONS IN THE GRAIN BELT.

FORECASTERS SAY THE PARCHED MIDWEST RECEIVED BETWEEN ONE AND TWO INCHES OF RAIN THIS WEEK. COMBINED WITH SLOWLY WARMING TEMPERATURE READINGS, THE RAIN PROVIDED NEAR PERFECT GROWING CONDITIONS IN THE GRAIN BELT.

CORN IN SOME PARTS OF THE MIDWEST ALREADY IS SAID TO BE A FOOT HIGH. USDA HAS PROJECTED A RECORD SOYBEAN CROP FOR 2000 AND A NEAR RECORD CORN CROP.

IN THE PITS, THE SCATTERED RAINFALL PRODUCED A DIFFERENT KIND OF WEATHER-LIKE EVENT ... EVAPORATION. THE DROUGHT PREMIUM THAT HAD SUSTAINED COMMODITY PRICES FOR SEVERAL WEEKS DISAPPEARED AS THE RAINS CAME, LEADING ONE FLOOR TRADER TO CALL IT ... QUOTE ... THE WETTEST DROUGHT IN HISTORY."

A BAILOUT BY SPECULATIVE COMMODITY FUNDS FUELED THE MIDWEEK SLIDE, WHICH TOOK JULY CORN FUTURES PRICES TO THEIR LOWEST LEVEL SINCE JANUARY. FOR JULY BEANS, PRICES HIT THEIR LOWEST LEVEL SINCE EARLY MARCH.

DESPITE THE WELCOME SIGHT OF RAIN, FORECASTERS ARE WARNING THE DROUGHT AFFLICTING MANY AREAS OF THE COUNTRY IS NOT OVER. IN IOWA, FOR EXAMPLE, 63 PERCENT OF THE SUBSOIL MOISTURE IS STILL RATED EITHER SHORT OR VERY SHORT. IN KANSAS, THE RAINS ONLY TEMPORARILY DELAYED PLANS TO CUT WATER RIGHTS IN SOME AREAS OF THE STATE. AND IN WEST TEXAS, CONCERNS ARE MOUNTING OVER A COTTON CROP THAT HAS RECEIVED ONLY SPOTTY RAIN.

ON THE TRADE FRONT IT APPEARS THE U.S. WILL RATCHET UP MORE PRESSURE ON THE EUROPEAN UNION TO RESOLVE TWO LONG-STANDING TRADE DISPUTES. U.S. TRADE REPRESENTATIVE CHARLENE BARSHEFSKY HAS SET A JUNE 19 TARGET DATE FOR CHANGING THE LIST OF IMPORTED ITEMS THAT WILL BE SUBJECT TO MORE 100 PERCENT RETALIATORY DUTIES. THE TARIFFS WOULD BE LEVIED FOR THE E.U.'S FAILURE TO ADMIT AMERICAN BEEF GROWN WITH HORMONES AND BANANAS FROM AMERICAN-OWNED PLANTATIONS IN THE CARIBBEAN.

APPARENTLY THE CURRENT LIST OF ITEMS TARGETED FOR THE PUNITIVE TARIFF'S HASN'T ENCOURAGED THE EUROPEANS TO BACK OFF FROM THEIR BAN ON AMERICAN BEEF AND THE ADMINISTRATION WILL NOW ATTEMPT TO DEVISE A LIST THAT WILL.


Tags: agriculture commodity prices markets news rain