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story.lead_photo.caption A farmer harvests rice in Monroe County near Brinkley in this September file photo. (Arkansas Democrat-Gazette/Staton Breidenthal)

Corn and soybeans rallied for a sixth day Wednesday, driving both crops to fresh six-year highs, as farmer protests and dry weather in South America threaten to further tighten supplies.

Grain markets surged in the past month on adverse weather and as some nations moved to restrict exports to ensure local supplies. Argentina last week announced a temporary suspension on corn-export licenses, prompting farmers to plan a three-day January sales halt in protest. Dryness in the region has raised worries for corn and soy harvests, while top wheat shipper Russia will curb grain exports from mid-February to tame food inflation.

The supply concerns come at a time when China's crop-buying spree and bets on an economic recovery are bringing commodities back in fashion. Feed-grain demand in the Asian nation is swelling as its massive hog industry rebuilds from a swine disease, and hedge funds have a near-record net-long position across agricultural markets.

"The dangers to global corn production are clear and present," Rabobank analysts including Stefan Vogel wrote in a note. "Argentine and Southern Brazil crops are advancing into a moisture-intensive stage amid dryness and only intermittent rainfall expected. Yield reductions will heap pressure on a nearly maxed-out U.S. export program."

March corn futures rose 3 cents to $4.94 a bushel with the most-active contract at times exceeding $5 a bushel for the first time since May 2014. Soybean futures rose 15 cents to $13.62 a bushel while wheat fell 6½ cents to $6.47.

Farmer groups in Argentina, the world's third-largest corn exporter and the top shipper of soy products, intend to stop grain sales for three days next week to show their opposition to the government's corn-export suspension, a move designed to protect domestic supplies.

Growers are concerned that the export halt could jeopardize Argentina's reputation as a reliable supplier, Commerzbank AG analyst Carsten Fritsch said. Recent worker strikes there have also snarled crop shipments, with a backlog of more than 100 vessels last month.

For the next harvest, most of the country's fields should stay dry through Saturday, while rain will aid soy crops in southern Brazil, according to Don Keeney, senior agricultural meteorologist at Maxar. StoneX cut slightly its soy-crop estimate for Brazil, citing December dryness in the nation's top growing state. The U.S. is due to update its monthly global crop estimates next week.

"Weather issues, government intervention and strong export demand suggest the current commodity bull run has further to go in 2021," Rabobank said.

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