Corn Prices Surge 2 years, Inventories Fell Lowest in first March 2012

Corn prices surge from 2010 till this year 2012, while corn inventories in first March 2012 fell lowest since 2004 according USDA. Corn futures prices for May 2012 delivery jump by the exchange limit of 40 cents, or 6.6 percent, to close at $6.44 a bushel at 1:15 p.m. That was the biggest gain for a most-active contract since June 30, 2010. The advance pared the decline for the quarter to 0.4 percent according CBOT.

Corn stockpiles on March 1 fell 7.9 percent to 6.009 billion bushels from a year earlier, the USDA said. Analysts in a Bloomberg survey expected 6.16 billion, on average. The agency’s estimate of consumption in the three months ended Feb. 29 unexpectedly rose 3.1 percent to a record 3.64 billion bushels. That figure includes use in food, livestock feed and fuel, along with exports and waste.

American corn acreage this year will be the largest since 1937, and more than expected, as profit prospects improve and warm, dry weather encourages farmers to boost plantings, the government said. Soybean acres are forecast to fall while wheat seeding may climb. About 95.864 million acres will be planted with corn, up 4.3 percent from 91.921 million last year and more than the 94.658 million expected by analysts, the U.S. Department of Agriculture said today in a report based on a farmer survey. Farm net income may total $91.7 billion this year, the second highest on record, the USDA said last month.

Corn farmers in some parts of the Midwest can make more than twice as much from an acre of corn as from soybeans, according to AgStar Financial in Rochester, Minnesota. In Illinois, the biggest corn-growing state after Iowa, farmers have already started seeding following recent record high temperatures, the USDA said earlier this week.