If you note the index, it is at a 5 month low!
A couple of things to note here that I was unable to get to this morning amidst the hustle and bustle of trading activity. First, corn demand has fallen off because feed demand is falling off. The reason is because we now know that there are less piggy mouths around to feed than previously expected. Also, cattle numbers are well off last year's levels as well. Less animals to feed means less corn demand.
Secondly, even though planted acreage estimates for corn are lower than last year, traders are expected the harvested crop to actually come in larger than last year. The reason is because we have thus far had nearly ideal growing conditions. The crop looks terrific at this point as it enters the key pollination stage and for now, forecasts look benign.
Wheat prices are low but global supplies are ample and US prices have had to respond to increased competition from other nation suppliers.
I do want to add another note here - today is both the end of the month and the end of the quarter. End of the month positioning is bad enough but throw in a good dose of end of the quarter book squaring, and all manner of strange price moves can be seen.
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