After a dry spring threatened to wither the U.S. corn crop in the fields, farmers are harvesting what will likely be the country's third-largest crop ever.
A bumper harvest will strain storage capacity and hold down prices of the world's most traded commodity crop. This will benefit customers who will pay less for corn used to feed livestock, dairy cows and egg-laying chickens or to make ethanol biofuel. But it will squeeze profits for farmers, who will store corn and hope for new demand from exports or new domestic uses.
When the combines have finished the harvest and all the corn has been delivered for customer and exporter needs, the corn left in storage should exceed the amount that has sat in U.S. silos for seven years, according to the U.S. Agriculture Department . Just 16 months ago corn prices were at their highest in a decade as the war in Ukraine disrupted supplies from the Black Sea breadbasket.
USDA forecast that domestic corn supplies would jump 55% to 2.111 billion bushels in the 2023/24 marketing year, helping push the global stockpile to a five-year high by September 2024. Pitstick, who devotes about half his acreage to corn, said he plans to store all the grain he has not already committed to sell. In the past 10 years, he has tripled his storage capacity to about 500,000 bushels.Still, rising interest rates make storing grain a more expensive and risky proposition. Some growers need to take out loans to fund their operations as they wait and hope corn prices will rise.
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