As the corn and soybean harvest looms, many farmers are beginning to sell this year's crop more heavily, pushing prices lower this week. Prices accelerated downward on Monday, when the USDA released a report showing a slight increase in the soybean crop size and a sharp decrease in corn demand. This year's harvests are projected to be large, but still barely sufficient to meet large world demand. As such, some analysts are expecting grain prices to remain relatively high, in order to continue enticing global producers to plant large crops.
This week, soybeans for November delivery slipped 77 cents per bushel (-5.4%) to $13.55, while corn for December delivery lost 50 cents (-6.7%) to $6.95.
Consumers adding sugar to their morning coffee will be relieved to know that sugar futures prices crashed 2.23 cents per pound this week, or 7.4%. This week's sell-off accelerated Friday morning on news that Brazil, the world's largest sugar producer, had made an unexpectedly large delivery to a storage facility in London. Earlier in the summer, sugar traders had been concerned that last year's drought in Brazil could cause a disappointing harvest. Rosier weather in Brazil, increasing supplies, and reduced expectations for rapid global economic expansion have contributed to declines in global sugar prices.
While corn is used to produce ethanol in the United States, over half of Brazil's sugar crop is used to produce ethanol. Falling U.S. corn prices have been seen as dragging down the sugar market, as cheaper corn becomes a more attractive source for the fuel additive.
Sugar for October delivery traded at 27.75 cents per pound on Friday.
Copper chops lower
Over the last two weeks, copper prices have fallen 30 cents per pound (-7.1%). Prices have been weak due to continued concern about Europe's debt problems and slow global economic growth. Copper is used across the electronics, automotive and housing industries, all of which are experiencing lackluster demand right now.
Despite the recent setback, copper prices remain historically high. Over the last three years, copper prices nearly tripled, largely due to strong Chinese demand. As of midday Friday, copper for December delivery in New York was trading near $3.93 per pound.