Corn prices continued lower this week, dropping underneath $3.50 per bushel for the first time this year after the USDA showed improving corn crop quality on Monday.
The USDA was already projecting an ample 14.2 billion bushel crop, and improving quality could boost the crop size to the second-largest ever. Southern states have begun harvesting this year’s crop and are reporting high yields.
However, many private forecasters fear that the crop is in worse shape in Midwestern states, which could provide a spark to the markets if they are correct.
If there is a harvest shortfall this year, it could be exacerbated by the currently low prices. Demand for corn has been climbing as buyers scoop up the grain at a bargain price, and shipments to foreign buyers have risen 23% over the previous year.