Weather rally continues in corn market

Corn futures continued Monday's rally, while soybeans sold off. We have audio comments from Illinois climatologist Jim Angel, talking about subsoil moisture supplies.

John Hawkins

Published: Jun 26, 2012

Corn futures on Tuesday traded sharply higher, extending Monday's limit-up move, as traders continue to have prices accurately reflect the potential for lower yields resulting from stressful crop weather. Yet, soybeans slipped from early gains, succumbing to profit-taking pressure.

Meanwhile, Illinois state climatologist Jim Angel told RFD Radio today that subsoil moisture supplies are being depleted earlier than normal this year, due to dry conditions. He says current conditions remind him of late August, instead of June.

U of I ag economists Scott Irwin and Darrel Good says it's unlikely the Midwest will be able to achieve a trendline yield in corn this year.

The economists say it's highly unlikely that states with good growing conditions will offset lower yields in the central and southern Corn Belt.

"That currently seems highly unlikely for two reasons. First there are currently 72 percent more corn acres in those states experiencing very poor growing conditions than in those states with very favorable conditions. The second reason is that the yield impact of weather is not linear. That is, poor weather tends to reduce yield proportionately more than good weather increases yield."

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