How Low Will Corn Prices Go?
The recent dramatic decline in crop prices is a boon for livestock producers but a bust for crop producers, particularly for producers who just agreed to pay high rents. More generally, the tremendous volatility in all commodity markets makes it nearly impossible for producers and the food industry to plan for the future. But farmers need to begin planning for their 2009 crop, and food producers need to make procurement plans for the remainder of this marketing year. The type of plan that will be profi table depends on the answers to a number of key questions: Have we seen the end of high corn prices? Will prices continue to decline, and if so, how low will they go? Have we seen the end of the food versus fuel debate?