Corn, Soybeans, wheat prices 8/9/2012

Corn, Soybeans, wheat futures prices 8/9/2012 : Corn rose to the highest price ever and soybeans gained the most in a week on mounting signs that the Midwest drought will erode production in the U.S., the world’s largest grower and exporter. Wheat also advanced.

Corn futures for December delivery jumped 1 percent to $8.25 a bushel at 10:19 a.m. on the Chicago Board of Trade, after touching a record $8.2975. Prices have reached all-time highs four times in three weeks.

Soybean futures for November delivery rose 2.1 percent to $16.145 a bushel, heading for the biggest gain since July 30. The most-active contract touched a record $16.915 on July 23.

Wheat futures for December delivery advanced 1.7 percent to $9.2875 a bushel on the CBOT, heading for the third increase this week.

U.S. Department of Agriculture outlook report 10 2012
The U.S. Department of Agriculture, in a report tomorrow, probably will cut its domestic corn-crop forecast to 10.929 billion bushels, the smallest in six years and down 16 percent from its July forecast, a Bloomberg survey of analysts showed. The estimate for soybean output may be reduced 8.3 percent to 2.796 billion bushels, the smallest since 2007. Corn prices through yesterday were up 61 percent since mid-June, and soybeans rallied 20 percent.

Impact Drought
About 69 percent of the Midwest, where U.S. farmers harvested 60 percent of last year’s crop, had moderate to exceptional drought conditions as of Aug. 7, the highest since the government-funded U.S. Drought Monitor in Lincoln, Nebraska, began tracking the data in 2000.

About 50 percent of the corn and 39 percent of soybeans in the U.S. were in poor or very poor condition as of Aug. 5, the worst for that date since at least 1988, government data show. The USDA reduced its outlook for domestic corn output by 12 percent on July 11, a month after predicting a record harvest. U.S. soybean production was cut 4.8 percent to the smallest crop in four years.

The world could face a food crisis of the kind seen in 2008 if countries restrict exports due to concerns about a drought- fueled grain price rally, the United Nation’s Food & Agriculture Organization said today, after reporting a 6.2 percent surge in global food prices last month.

Corn is the biggest U.S. crop, valued at $76.5 billion in 2011, followed by soybeans at $35.8 billion, government figures show. Wheat is the fourth-largest at $14.4 billion, behind hay

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