Port St. Lucie, FL (PRWEB) July 6, 2010
T & K Futures and Options, Inc. predicts much higher corn prices for three basic reasons: 1) Ethanol production is expected to reach as much as 35% of total corn usage this next season. 2) China is importing corn for the first time since 1996. 3) The corn market has most likely factored in a new record high yield per acre for the upcoming corn crop setting itself up for a potential weather scare rally.
Corn production may be lower than consumption for this year because of much higher use of corn for ethanol production. The USDA estimate for the use of corn for ethanol production is much higher than expected and this trend may continue as long as unleaded gasoline prices continue to stay above $2.50 per gallon. The most recent Department of Energy report showed an increase in demand for gasoline. Visit http://www.tkfutures.com/unleaded_gas.htm to learn more about unleaded gas futures and options trading.
China has had many problems with its corn production based on awful weather problems including a severe drought which affected this year's corn crop. China also has a growing population and a growing middle class who are consuming higher quality protein sources like chickens and pigs which in turn are using up available corn feed supplies. China is now importing corn for the first time in 14 years to meet the current demand needs of the country. Visit http://www.tkfutures.com/corn.htm to learn more about corn futures and options trading.
The most recent USDA report estimates that the corn yields per acre will be the second highest in history. This information is most likely already factored into the corn futures prices which are near contract lows. Any significant weather problems may reduce yields and cause the expected production deficit to grow considerably. This might be another catalyst to violently higher corn futures prices over the next few months. Typically the most crucial period for the corn development is the pollination stage which occurs between June and July in Northern Hemisphere. Visit http://www.tkfutures.com/education.htm to learn more about trading corn futures and options.
The author of this article is a 15 year veteran of the corn futures and options markets and the President of T & K Futures and Options, Inc. Corn futures and options trading carry significant risk of loss and only risk capital should be used.