Inclement weather harming global crops helped push up prices for corn futures on Tuesday morning, Bloomberg reports.
The world supply of the grain is tightening, which might help the commodity increase to record prices some time during the first two quarters of 2011k, according to analysts. Corn also is likely to be the market's best-performing agricultural commodity. Three investment houses – Agrocorp, Rabobank International and Blackstone Group – are predicting 2011 will hold record prices for corn, in part because stockpiles are reducing throughout the world.
"As the global economy recovers with steady growth, the crop prices may remain at historically high levels for a number of years," according to a Tuesday report by analyst Ker Chung Yang of Phillip Futures.
Shortly after 8 a.m. on Tuesday, corn futures were down 0.21 percent, a 1.5 cent reduction to $7.05 per bushel.
Some analysts expressed concern about climate change negatively impacting supplies of the commodity, as well as other grains. Coffee and cotton also are exposed to potential losses.
"The fact is that climate around the world is changing and that will cause massive disruptions to supply chains," Sunny Verghese, Olam chief executive officer, told Bloomberg. "We're friendly to wheat, corn and soybeans and bearish on rice."
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