Perfect Storm?

The 2011 corn crop isn’t in the ground yet.  But I’ve never seen the expectations so high, the pressure so great, the experts so nervous.  Farmers, agribusinesses, ethanol producers, Wall Street, the livestock industry, consumers – everyone has a stake in it this year.

U.S corn surpluses are at the lowest level in 15 years, the second smallest in 74 years.  Corn prices are already at record highs.  Droughts in Russia and China have increased exports.  High fuel prices are driving more demand for ethanol.  Food prices are soaring.  Many around the world are hungry.

There are too many interests competing for a finite supply, which could be the perfect storm for disaster if things don’t go well this season.

Speaking of storms, last year Iowa’s corn yield was cut by 9 percent due to flooding.  What’s in store for this year?

From the Des Moines Register:  “If the crop suffers, the consequences could ripple across the globe, from the trading floors of Chicago to Wall Street and Beijing, Seoul and Mexico City, where citizens are becoming more accustomed to the taste of corn-fed beef and pork.”

This season will really be interesting.

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