After the record drought decimated crops last year, U.S. farmers planted a record amount of corn. With mild temperatures forecasted across the Midwest, an expected record crop yield is weighing on grains exchange traded funds.
Corn futures are on an eight day losing streak, declining another 1.6% Monday and touching its lowest price since October 2010, Bloomberg reports. Prices have plunged 11% across the eight trading sessions, the longest down streak since February.
U.S. farmers planted a record 97.4 million acres of corn, the most since 1936 and also exceeding analyst expectations of 95.4 million acres. Last month, the United States Department of Agriculture projected a record harvest this year of 14.005 billion bushels, or up 30% year-over-year.
Meanwhile, temperatures across the Midwest, the largest growing area in the U.S., is expected to remain lower than normal over the next five days, diminishing the risk of heat-related yield losses.
“There’s no heat in the extended forecast, so the weather is no real threat to anybody,” Mark Schultz, the chief analyst at Northstar Commodity Investment Co., said in the article. “The fact that we have 97 million acres of corn was a shock to everybody.”