Corn prices are going insane. For those Apocalypse Now fans out there, they're going all Kernel Kurtz on us. The July futures price on a bushel of Midwestern pride cracked $7 yesterday, and it's not looking back.
So why's corn going pop? Well, it's funny; when gasoline is on the rise, oil companies are called out for their profiteering ways. Somehow, when it comes to corn and other agricultural commodities, people are able to focus on the fundamentals of supply and demand. In this case, it's the weather.
Flooding in Nebraska, tornadoes in Iowa -- it's brutal out there in corn country. This wicked weather coincided with planting season, and it's getting too late to replant corn. One agronomist estimates that if corn were planted now, it would only yield 65% of a normal crop come harvest season. The Midwestern tempest has already led the USDA to cut its corn harvest estimate by over 3%.
All of this damage is catapulting corn prices and crushing corn consumers, and ethanol producers look particularly vulnerable. That's led a Citigroup
You know what else looks like a poor call? Another analyst downgraded non-ethanol refiner Corn Products International