The drought is pushing prices higher for corn and soybeans. Traders are aware that corn and bean fields are drying out, and the situation will soon become dire, says John Hawkins of the Illinois Farm Bureau.
“If we don’t get a timely rain in the next 10 days or so, then we’re probably going to see yields diminish and we’ll probably see prices higher. But unfortunately in dry years, usually the price doesn’t go [up] enough to make up for that shortfall in production,” he said.
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Prices on future contracts at the Chicago Board of Trade have been steadily rising as the drought has become noticeable: September corn is up over 50 cents in the last week, now at $5.68 a bushel. September beans are up $1.40 since the start of the month, settling at $14.10.
Hawkins says farmers could gamble and sell their fall crop at the higher prices, but they hesitate because they worry whether they’ll have the production to satisfy the contract.
Hawkins says some farmers in Southern Illinois have already plowed under their corn and beans, which were not coming up, and will make an insurance claim.