July 8,2015
Two key commodities are heading opposite directions this week with oil prices going south and corn , the key feed ingredient for the dairy and livestock industry moving higher.
WTI oil had been around the $60 mark until July 1 but has plunged to the $51-52 range as global weakness and oversupply collided.
The plunge could spell good news for motorists in California still paying gas prices that seem to be based based on $90 oil.
San Joaquin Valley crude is feeling the hurt as well with Kern’s Midway Sunset at $49 today falling from $54 a few days ago, the lowest since April.
As for corn Midwest rains are flooding fields say industry sources hurting the potential yield for this year’s crop that , based on planting , is down 2% anyway.It is the lowest planting acreage since 2010 says USDA.California corn acreage is down 17% this year.
For dairymen higher corn prices coming on the heels of weak milk prices area one- two punch they could do without. Until now the market had expected $3.50 corn this summer, now almost 20% higher.