I am an Iowa farmer and have many farmer connections across the state. The drought of 2012 has been brutal and I have been hearing some yield results if anyone is interested. Now, bear in mind, I am not going to make light of the crop losses that are being incurred, however, the worst of the perception of losses may have already been seen. In early August, many farmers I talked to had very low (I mean VERY low) expectations. A number of them were talking about 30-80 bushel/acre corn. Some of those people are harvesting and finding results more like 50-120 bushel/acre. Still sucks, but just not as bad. My only point is, the worst yields are likely to come out first. The later yields will gravitate toward more normal (less disastrous) numbers. This crop is incredibly short, but the losses may have been largely priced in. Crop insurance will keep most of the grain producers in the game for at least another year. My concern is for the small, independent livestock producer whose animal doesn't care about an insurance check, it just needs some feed. I guess what I'm saying is that its entirely possible that the 2012 high has been put in in the corn market, but be prepared for volatility through the winter/spring months as the world needs a good crop from South America followed by a good North American crop in 2013.
Thanks Doc for the post. Sorry I just now saw it.
Analysis: Prices drive soy farming into Brazil cattle country
Big soybean acres planned for South America. With decent weather, this crop will be huge with prices trending lower. Like Doc said, the world needs a good crop out of S.A.
However, the market will be very quick to react if any weather issues develop.