Corn prices popped this week as markets grew increasingly concerned about severe planting delays across the Corn Belt. Nationwide, only 30% of the crop had been planted as of last week, compared to a recent average near 60%.
Waterlogged fields are preventing farmers from being able to get machinery into their fields, and they are expected to fall further behind as more rain is in the forecast. For many farmers who are behind schedule, federal crop insurance may be their best option, as late-planted crops can suffer from lower yields or be at higher risk of frost damage in the fall.
Either way, grain watchers are expecting a smaller corn crop, which helped prices explode over 10% this week, with July corn trading for $3.84 per bushel on Friday.
Another option for farmers who can’t plant corn during May is to switch fields to plant soybeans, which typically can be planted another two weeks later than corn.
This last-minute swap could lead to increasing soybean production this year. Fears of more beans and less corn, along with the ongoing trade disputes with China, have crushed soybean prices, which traded Monday below $8 per bushel for the first time in a decade.
Oil tense amid Iranian threats
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Oil traders are anxiously watching news out of Washington D.C. and Tehran as the U.S. and Iranian governments continued trading warnings this week.
Iran is threatening to restart its nuclear program in response to U.S. sanctions that President Trump levied after withdrawing from the 2015 nuclear deal.
The United States has also begun planning for military action against Iran and is withdrawing embassy staff from Iraq, actions that are putting Iran on notice.
Meanwhile, there have already been attacks against oil shipments traveling through the Strait of Hormuz, and initial U.S. assessments blamed Iran. The strait is a narrow passageway between Iran and the Arabian Peninsula; one fifth of the world’s oil shipments flow through those waters, making any conflict with Iran and immediate threat to make oil prices explode.
As of midday Friday, June crude oil futures traded near $63 per barrel.