By Jonathan Barratt


It looks like we can anticipate more rains to come as a result of the Hurricane Issac in the Gulf. As we mentioned above we feel that most of the damage has already been done however the mere fact of potential rainfall will provide a sigh of relief for the markets. One of the interesting twists to the drought saga is that if we get too much rain then harvesters will find it difficult to enter the paddocks to harvest and the already weakened corn stalks may not be able to weather the wind and topple over. We have seen this before and it is more devastating than the actual drought. You can see the crop but it cannot be harvested until the paddocks dry out and the harvesters can get in. At this stage on the production cycle we should be seeing more pressure associated with the harvest, however so far this price action has been pretty tame.