US Corn Rises On Some Crop Concerns In Mexico

Corn futures were higher on Friday. March futures were 8 cents higher at $7.06 1/2. The May contract closed 7 3/4 cents higher at $7.17 1/4. December 2011 was 3 3/4 cents higher at $6.18 1/4.

The strength in corn price was tied to reports that a freeze in Mexico last week damaged the winter corn crop. The winter crop is only a portion of Mexico's crop, most of which hasn't been planted yet. Initial indications were that the damage was limited, but reports now point to more significant damage. USDA's current estimate is 24 mmt. There is no doubt that the freeze was very damaging to crops, particularly vegetables, but the 4 mmt plus losses for corn seem too high. Regardless, the corn market responded quite positively to the speculation about possible crop losses.

The corn market has moved higher the past two days while soybeans have eased. The new-crop soybean to corn price ratio is declining, shifting further in favor of additional corn acreage.

(Source: http://www.indiainfoline.com/Markets/News/US-Corn-Rises-On-Some-Crop-Concerns-In-Mexico/3550511580)