Corn futures closed higher on Monday on the Chicago Board of Trade, with intraday highs marking the strongest levels in over a month. Market participants pointed to worsening weather forecasts across key U.S. growing regions and a surge in crude oil as drivers of the move.
Contract movements
The September corn contract finished the session up 1-1/2 cents at $4.41 per bushel. New-crop December corn rose 2-1/4 cents to settle at $4.63-1/4 per bushel after touching an intraday peak of $4.69-1/2, a level not seen since June 2.
Weather concerns in the Corn Belt
Forecasts showed hot and mostly dry conditions across the western half of the U.S. Corn Belt for the week, with that pattern possibly extending into the following week. The timing is notable because July is considered a pivotal month for corn; much of the crop undergoes pollination during this period, which is a key determinant of final yields.
Energy market influence
Energy markets provided additional support for grain prices as crude oil surged by more than 8%. The rise followed statements by U.S. President Donald Trump that the U.S. was reinstating a naval blockade on Iran, a development that raised concerns about the security of energy shipments through the Strait of Hormuz. Corn and soybean prices sometimes move in partial tandem with crude oil because both crops serve as feedstocks for biofuels.
Given the combination of weather-driven crop stress during a critical stage and elevated energy prices tied to geopolitical developments, market watchers noted the conditions underpinning Monday's gains in corn futures. The degree to which those factors persist will be relevant for prices in the near term.