Corn production in the United States, the world’s biggest shipper of the grain, will be “huge” as warm weather encourages farmers to plant early to avoid the risk of late-season frost damage, economist Dennis Gartman said.
The fourth-warmest U.S. winter on record will be followed by above-normal temperatures from March through May and no floods are expected for the first time in four years, National Oceanic and Atmospheric Administration data show. That will give farmers a chance to plant earlier than normal and yields probably will improve, Gartman said in his daily Gartman Letter.
“Early planting favors higher yields given that the crop likely shall pollinate earlier, long before the heat of the summer and thus allowing the plant to mature before any threats of early autumn frost,” Gartman said. “This year’s corn crop then, all things being otherwise equal, is going to be huge.”
Corn futures on the Chicago Board of trade are up 3.3 percent this year on speculation that demand for the grain used to make food, fuel and animal feed will increase.
Chinese purchases and stockpiles are “the focus” of corn prices, Gartman said. U.S. exporters sold 240,000 metric tons of corn for delivery before Aug. 31 to an unknown buyer, the Department of Agriculture said on March 13. That buyer may be Chinese feed manufacturers, said Jim Gerlach, president of A/C Trading Co. in Fowler, Ind.
Indiana was ranked fifth among states in corn production a year ago.