On Friday, corn reached the highest price since early December, climbing to over $7.46 per bushel. Prices rallied as the market grew more concerned about hot and dry weather in Argentina threatening that nation's crop. Argentina is the world's fourth-largest corn producer, and its April to May harvest is especially important because it comes when the world's corn stockpiles are getting low.
This week's rally may have changed the outlook on the price charts as well, with some "technical" corn traders noting that corn has broken its downward price pattern. As of midday Friday, corn for March delivery was worth $7.41, up 21 cents (+2.9%) on the week.
As corn prices rose this week, so too did soybeans, which climbed 40 cents per bushel (+2.8%) to $14.80 by midday Friday. Farmers across the Midwest closely watch the prices of both commodities to make crucial decisions as they invest in seed, fertilizer, equipment and land to prepare for the upcoming growing season.
Orange Juice Bursts Higher
Orange juice prices rose this week amid concerns about crop quality. Prices for frozen concentrated orange juice (FCOJ) rose as much as 9.8 cents per pound (+8.6%) during the week. The primary concern among traders is a disease known as "citrus greening" which causes premature fruit dropping. Ongoing dry weather across Florida could exacerbate the disease in the world's most prominent orange-producing region. These concerns have led the USDA to lower its estimates for Florida's orange production twice already this season; another crop update is expected next Friday, February 8. FCOJ for March delivery was worth $1.21 per pound midday Friday.
Gasoline Gushes Skyward
Prices for unleaded gasoline surged another seventeen cents higher this week, pushing over four-month highs. Gasoline has gotten 12% more expensive over the last few weeks, driven higher by a slew of refinery closures.
Historically, late winter is a period of low gasoline demand, but the closures are reducing the available supply of gasoline, causing drivers to feel a pinch at the pump. Some analysts warn that prices could continue to rise as demand increases from its currently low level, potentially making this summer another expensive driving season.
The price for March gasoline, which represents wholesale gasoline, without taxes or other fees, was worth $3.0575 per gallon as of midday Friday.