Corn Hoping to Rebound

Although the corn market has been hammered in the last two weeks, some analysts expect that the market could stage a comeback in the coming weeks. On the demand side, there has been increased buying as corn is at its lowest price level in three months. Furthermore, high global sugar prices are causing ethanol producers to consider substituting corn for sugar in their production of fuel alcohol.

Supplies are tightening as farmers aren't willing to sell their corn at these low levels. There is also growing concern that vomitoxin, a mold byproduct, could decrease the size of this year's usable crop. Despite all of these bullish factors, corn has been unable to stage a recovery, trading Friday morning at $3.60 per bushel, down 15% this month.

Sugar Rushes to 29-Year High

Sugar surged up this week over 30 cents per pound, a price that hasn't been seen since 1981. Despite the recent drop in most other commodities, sugar has continued to rush upwards as global supplies tighten. Sugar's rise began over a year ago, but the market has recently accelerated upward, jumping 8 cents/lb, or 36% since early December.

Although sugar is produced in nearly every country around the world, the market has been largely driven by Brazil and India, the largest global producers. Both countries have recently encountered weather-driven supply disruptions, reducing their output and even forcing the Indians to import sugar. As of Friday afternoon, March Sugar traded on the Intercontinental Exchange in New York was trading at 30.08/lb.

Copper's Crash Continues

In the last week, the U.S. Dollar strengthened and concerns over China's tightening credit policy worsened, putting more pressure on commodities. The stock markets' continued erosion also undermined investor confidence, causing some traders to dump economic-driven commodities.

The hardest-hit market was copper, which fell to a two-month low on Friday morning. Some traders fear that the year-long bull market in copper may have come to an end, as the red metal has fallen 49 cents/lb, or 14% since making its high at $3.54/lb on January 7th.