Winter's grasp continues to linger across much of the Midwest, forcing some farmers to wait for a thaw. Before they can plant corn, soil temperatures need to rise toward 50 degrees, which could take a while given the fact that many fields in the Upper Midwest still have frost that extends a foot or more into the soil.
Despite a potentially slow start this year, few farmers are worried about being able to plant their crop. As technology and equipment have improved over the past few decades, farmers have been able to plant their crops more quickly, making delays less threatening than they had been in the past.
Unable to get into the fields much this week, many farmers were closely watching the USDA's monthly Supply & Demand Report released Wednesday, which showed increasing projections for US corn exports. In the wake of the report, corn prices popped to a seven-month high of $5.19 per bushel. In the coming weeks, planting progress and weather will likely remain in focus for corn traders, producers, and end users.
Gasoline Charges Higher
Gasoline prices leapt to a one-month high this week, pulled higher by tight supplies and spillover support from high crude oil prices. National gasoline inventories are currently running a bit below average, and the US Department of Energy is projecting moderately higher fuel demand this year, helping to push prices higher by more than ten cents per gallon this week.
Meanwhile, crude oil prices have been rising due to increasing threats of tension between Ukraine and Russia. Conflict could lead to sanctions against Russia, which would reduce the flow of oil from Russia to other nations, a factor that boosted crude oil prices by $3.00 per barrel this week.
Gloomy Outlook for Florida's Oranges
This week, the USDA released its updated projections for Florida's orange crop, predicting the smallest crop since 1985. The Sunshine State's orange production this year is expected to be 110 million boxes (90 pounds each), down 25 percent over the last two years. The drop in production is being attributed to a bacterial infection known as citrus greening, which causes trees to wither and prematurely drop fruit.
Dry conditions in Southern Florida are also weakening the orange trees' natural resistance to disease, exacerbating the damage. As a result of the sour outlook, the futures market for frozen concentrated orange juice exploded this week, pushing over $1.66 per pound, a two-year high.