Chicago Board of Trade (CBOT) corn futures retreated from a 16-month peak on Wednesday, as traders took profits and adjusted their positions in anticipation of increased U.S. corn plantings this spring. The most-active corn contract, which had climbed nearly 10% this year on strong U.S. export demand and a smaller-than-expected harvest last fall, dropped 4-1/2 cents to settle at $4.97-1/2 per bushel after reaching a high of $5.04-1/2, the highest level since October 2023.
The setback in corn futures was echoed in wheat and soybean markets, which also weakened after recent gains. Wheat futures backed off from an eight-month high, while soybean futures lost ground.
Analysts suggest that the surge in corn prices could prompt U.S. farmers to plant more corn this spring, as it is seen as a more profitable crop compared to soybeans. “The biggest, most important factor in the corn market right now is we’ve been buying corn acres,” said Jim Gerlach, president of A/C Trading. “It won’t last forever,” he added, noting that many farmers are still recovering from last year’s price slump, which saw corn and soybean prices hit 2020 lows.
Meanwhile, U.S. export demand for corn remains robust despite the recent price increase, with the nation’s inventories projected to hit a two-year low before the next harvest. Globally, corn stocks are expected to reach their lowest levels in a decade, according to the U.S. Department of Agriculture. Dry weather in Argentina and delays in sowing in Brazil could further tighten global supplies, analysts said.
“There won’t be much corn available out of South America until summer,” said Tomm Pfitzenmaier, an analyst with Summit Commodity Brokerage. He added that the U.S. is likely to be the primary corn supplier for the near future, which could help support prices through the late winter months.
In other markets, CBOT wheat futures (Wv1) settled down 11-1/4 cents at $6.06-1/2 per bushel, while soybean futures (Sv1) declined 6-3/4 cents to $10.31-3/4 per bushel.
