Despite farmer's wishes for sunny skies, rains continued to plague the Midwest this week, with more likely to come.
Too-wet conditions are forcing some farmers to give up on planting inundated acreage, which will reduce the nation's soybean and corn crop production this year. Meanwhile, soaked seedlings are struggling to mature properly, reducing potential yields for the growing crops.
These fears caused an explosion in the corn and soybean markets this week, with soybeans soaring to a three-month high at $10.02 per bushel and corn cruising to $4.06, a one-month high.
Most dramatically, wheat prices whipped to a five-month high at $5.66 per bushel on fears of rain delaying harvest and news of wheat diseases that could render portions of the crop unusable.
Though not crashing, crude oil, gasoline, and diesel fuel prices eased this week and continued to provide price relief to urban, agricultural, and industrial consumers.
A sharp, unexpected, rise in gasoline inventories was announced on Wednesday morning and contributed to the feeling that supplies of all petro products will remain abundant.
Uncertainties surrounding the Greek debt crisis, including a key deadline for Greece to pay a large debt on June 30th, added to economic fears and caused speculators to stand on the sidelines from many commodity investments. A potential deal with Iran over nuclear production also kept a lid on crude prices as additional oil supply could flow from that country if sanctions are lifted.
What could turn fuel prices back up? The Fourth of July is just around the corner and represents a peak in driving demand as relatives travel to gather around their grills. Warmer summer weather will create more demand for natural gas to make electricity to run air conditioners. Further political or military struggles with Russia, China, or the Islamic state loom as potential supply threats and could turn prices upward in a hurry.
Low-cost propane should help encourage grillers to fire up the backyard barbecue, as prices are near a thirteen-year low due to an overwhelming supply glut.
More importantly, meat prices are dropping just as peak grill season begins. August cattle fell to a six-week low at $1.48 per pound, while August hogs fell to new contract lows, trading for a mere 72 cents per pound. Prices are dropping as cattle and hog herds expand, boosting supply after years of shortages.