What’s affecting corn prices?

With the price of corn in the United States approaching record highs this year, the weather could be the culprit, according to AccuWeather. As reported by the Wall Street Journal, corn prices are up 50% to $7.73 per bushel. These prices are similar to highs during the 2012 drought that affected Midwest crops. During that year, prices soared to $8.31 per bushel.

“Like in 2012, the weather is a factor in the rising corn prices and, once again, drought is the primary trigger,” reports Chaffin Mitchell with AccuWeather. “However, it’s affecting farmers in Brazil rather than in the U.S.”

Brazil is experiencing rainfall amounts far below what is normal, which is stressing Brazilian corn crops that are in the critical pollination stage.

AccuWeather Founder and CEO Joel N. Myers sees the sharp increases in corn prices “as a result mainly of weather impacts.” According to Myers, the current rise in prices dates back to August of last year after U.S. corn farmers took a hit when a derecho caused widespread damage across Iowa, the nation’s top corn-producing state. This rare storm caused an estimated $11.2 billion in damages across a 770-mile area.

Myers said the derecho damage was just the beginning because corn prices are influenced by what happens elsewhere around the world. And right now, what’s happening in Brazil is exacerbating the rise in prices.

“It looks like the corn production in Brazil could be as low as 25% less than it looked even a month ago because of this ongoing drought,” Myers said. “And there doesn’t look to be any end to that.”