Indiana Grain Company, LLC

Posted: 06/30/10

By: tomgrisafi

We at Indiana Grain live for days like today.

Corn futures went limit up Wednesday on the Chicago Board of Trade on news that farmers will plant 1 million fewer acres than had been forecast earlier.

It's the official start to a busy summer.

December corn, which prices this year’s crop, went limit up and didn't relent much for the duration of the session.

Corn prices had fallen steadily through spring on news of surpluses of more than 1.5 billion bushels left over from last year’s crop and the prospect of another huge crop planted this spring.

Commodity trader Don Roose of US Commodities called the U.S. Department of Agriculture’s acreage report “bullish” for corn.

The report said farmers would plant about 1 million fewer acres of corn than the 88 million pegged in a report three months ago. The USDA also said demand for feed grains would be stronger, primarily due to better market conditions for hog and cattle producers.

Broker Tomm Pfitzenmaier of Summit Commodities in Des Moines said “the report this morning really caught the trade off guard. The trade was nearly unanimous in their expectation that the report would be bearish. So the trade was really caught leaning a little too much to the short side.”

The USDA said soybean plantings would total almost 79 million acres, up 2 percent from last year. That sent soybean prices down in Chicago. The November contract was down 9 cents per bushel to $9.04.

Source: Bloomberg, DesMoines Iowa Register