U.S. corn production is expected to reach 14.8 billion bushels this summer, with a record yield of 166 bushels per acre, compared to 12.4 billion bushels in the summer of 2011, according to the U.S. Department of Agriculture.
The stockpile estimates have also increased, to 851 million bushels at the end of August from an original estimate of 801 million bushels. Some of this year's crop may be ready for use earlier than normal because of a fast start to the planting season, said the USDA. Corn stockpiles have been small in the last couple of years due to weather-related damage and strong demand from livestock producers, ethanol manufacturers and overseas buyers.
The combination of strong demand and short supplies has kept corn futures above $6 for much of 2012. But if current predictions prove true, corn prices will fall, and that will likely mean lower supermarket prices for products that use corn. Beef and pork prices could fall, too, because feed prices could drop. "This would set the trend for six months from now for prices to be cheaper," said Jason Ward, an analyst with Northstar Commodity.
Farmers are forecast to plant a total of 91.9 million acres of corn — the most since 1937.