June 4, Reuters – (National; International) Analysis: High U.S. corn prices warn of summer shortage.
From Ohio to Kansas, corn is selling at startlingly high prices, so high that they are signaling the United States will run short of corn the summer of 2012, Reuters reported June 4. If it does run short, the impact could be felt worldwide. Sales to export customers such as Mexico, Japan, South Korea, and China could take a hit as America grows 40 percent of the corn sold on the world market. Domestically, sky-high prices could have U.S. millers suspending operations. If corn for feed costs too much then milk, egg, and meat farmers could curtail production leading to higher food prices. Prices on the cash market, where processors and livestock feeders buy corn for use, have been unusually high for months. They are much higher than historically at this time. “Either farmers aren’t selling or the corn isn’t there,” said a co-owner of Hollander-Feuerhaken, a Chicago brokerage and cash merchant. Even with strong basis, it was difficult to buy corn for domestic use, he said in late May.
Source: http://www.reuters.com/article/2012/06/04/us-corn-shortage-idUSBRE85316L20120604