Corn Futures Surge To 14-Month High As South American Weather Concerns Intensify
Date
1/24/2025 5:00:43 AM
(MENAFN- The Rio Times) Corn futures on the Chicago Board of Trade (CBOT) have reached their highest levels in over 14 months. The most active contract hit $4.945 per bushel on January 23, 2025.
This surge reflects growing concerns about South American crop conditions and tightening U.S. supplies. Drought in Argentina and excessive rainfall in Brazil have sparked worries about corn production.
These weather issues could delay the planting of Brazil's crucial second corn crop. Traders fear this might lead to lower yields and reduced global supplies. The USDA 's January report added fuel to the bullish sentiment.
It cut U.S. corn production estimates by 276 million bushels to 14.867 billion bushels. The agency also lowered ending stock projections, highlighting a tighter supply situation.
Strong demand continues to support corn prices. Ethanol production remains robust, averaging 1.099 million barrels per day in mid-January. This represents a 34.4% increase compared to the same period last year.
U.S. Corn Market Outlook
Export demand for U.S. corn has picked up as well. Weekly export inspections reached 1.541 million metric tons, surpassing trade expectations. This marks the highest level for this week in over 40 years of record-keeping.
Fund traders appear to be increasing their long positions in corn futures. This speculative buying adds momentum to the price rally. Analysts will closely watch the next Commitments of Traders report for confirmation of this trend.
Looking ahead, market participants are weighing several factors. These include potential U.S. acreage shifts, South American harvest prospects, and global demand patterns. The incoming Trump administration's trade policies could also significantly impact agricultural markets.
Corn prices are projected to remain elevated in the near term. However, volatility is likely as weather patterns evolve and geopolitical developments unfold. Farmers and traders must stay vigilant and adapt to rapidly changing market conditions throughout 2025.
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