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Column: Harvest pressures grains

Breitinger

Grain prices plummeted this week as farmers harvested this year’s crop at a record pace. Warm weather this past spring allowed farmers to get a jump start on planting, giving the crop an early start on development. Despite the damaging drought this summer, those plants that survived have continued to develop ahead of schedule, allowing farmers to get nearly a one-month jump on their usual harvest schedule.

By this weekend, nearly half of the country’s corn should be harvested and almost 20 percent of the soybeans, more than three times faster than the normal pace. As farmers harvested grain during the last week, many began selling their crop, pushing prices lower. During the week, corn prices crumbled 32 cents per bushel (- 4.1 percent), and soybeans sank $1.19 a bushel (- 6.8 percent). The selling had calmed by Friday, with corn and beans trading near $7.50 and $16.20, respectively.

Crude oil plummets

Crude prices collapsed this week, falling nearly $10 per barrel from last week’s highs. After pushing higher than $100 per barrel last week, crude prices came under attack on news that Saudi Arabia was going to increase oil production. Crude oil for October delivery fell as low as $90.66 on Thursday, down 8.4 percent during the week. Likewise, gasoline prices dropped as much as 27 cents from last week’s high.

Despite this week’s break, petroleum prices continue to remain relatively high because of ongoing concerns throughout the Mideast, as countries such as Libya, Syria and Iran continue to be embroiled in conflicts that could stem the flow of crude oil from the Mideast to consumers around the world.

Metals clamor higher

Precious metals continued their inflation-inspired rise this week, with gold and silver rising to six-month highs. Global investors have grown increasingly concerned that inflation is around the corner as central banks around the world, including those of Japan, the European Union and the United States, announced stimulative measures recently. By Friday, December gold had risen to $1,790 per ounce, and December silver had sprung to $35.26 per ounce.

Opinions are solely the writer's. Walt Breitinger is president of Breitinger & Sons LLC, a commodity futures brokerage firm in Valparaiso. He can be reached at (800) 411-3888 or www.indianafutures.com. This is not a solicitation of any order to buy or sell any market.

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