Corn, oil prices edge down

NEW YORK—The price of corn edged down slightly on yesterday, an aberration after climbing higher throughout the summer. Corn prices have soared since late June as a brutal drought has dried out fields across much of the country, particularly big corn producers like Indiana and Illinois.

On Monday, corn for September delivery hit a record of US$8.20 per bushel. Corn for December delivery, the most active contract, fell 8.75 cents, to US$8.0525 per bushel. As of this week, 48 per cent of the US corn crop is in “poor” or “very poor” condition, according to a research note yesterday by Stifel Nicolaus analysts led by Meyer Shields.

Last year at this time, only 14 per cent of the crop was in one of the two lowest conditions. Many analysts fear that even a good rain wouldn’t salvage the corn crop at this point in the season. “With 94 per cent of the corn crop already at or past the pollination phase, future rains this summer probably won’t have much positive impact on final yields,” Shields wrote to clients.

There is a little more hope for soybeans, which are planted later in the season. Shields said that rain “within the next week or so” could still boost soybean crops. November soybeans fell slightly, losing 2.5 cents to US$16.41 per bushel. September wheat fell nearly 3 per cent, losing 26.25 cents to US$8.8825 per bushel.

On the US stock market, indexes closed slightly lower as investors waited for details on whether the Federal Reserve planned to pump more money into the economy. That also pushed down most energy prices, which are tied to how investors feel about the economy. Benchmark US crude lost US$1.72 to end the day at US$88.06 per barrel in New York. Brent crude lost US$1.28 to finish at US$104.92 per barrel in London.

Gasoline lost 4.41 cents to end at US$2.7743 per gallon, heating oil lost 3.74 cents to finish at US$2.8417 per gallon, and natural gas fell less than a penny to finish at US$3.2090 per 1,000 cubic feet. The Conference Board said US consumer confidence rose in July after four months of declines.

That’s an especially-promising sign, given that consumer spending drives 70 per cent of the US economy. And the housing industry’s prospects looked brighter as prices rose across the country. As long as the economy shows signs of life, the Fed may hold off on new stimulus measures that in previous years propped up the price of oil, analyst Phil Flynn said.

“Good news is bad news when it comes to the stimulus,” he said. The Fed will talk about possible stimulus measures at a policy meeting this week. In other energy futures trading, heating oil lost 3.74 cents to finish at US$2.8417 per gallon, while wholesale gasoline lost 4.41 cents to end at US$2.7743 per gallon.

Natural gas gave up less than a penny to finish at US$3.2090 per 1,000 cubic feet. No key metals made significant moves. Gold for December delivery fell US$9.40 to US$1,614.60 per ounce. September palladium rose US$2.20 to US$590.55 per ounce, and October platinum rose US$5.10 to US$1,416.90 per ounce. September silver fell 11.9 cents to US$27.914 per ounce. September copper was virtually flat, edging up 0.15 cent to US$3.4175 per pound.

AP