MITCHELL, S.D. (AP) — South Dakota farmers getting ready to plant corn are looking at prices that are about $4 a bushel higher than they were last year.
Prices were above $7 a bushel at the Dakota Plains elevator north of Tripp, the Farmer's Alliance elevator in Mitchell and the Cargill elevator in Emery, the Mitchell Daily Republic reported Thursday.
Lisa Richardson, executive director of the South Dakota Corn Growers Association, attributes much of the run-up to rampant market speculation.
"We've added $1 a bushel to prices since the planting intentions report came out March 31," Richardson said. "And that's all speculation, because we haven't got any corn in the ground."
Craig Stehly was loading corn from a bin a couple of miles east of Mitchell. He said that even with the high prices, he probably won't plant much more corn compared to last year. Stehly said that anywhere he can plant corn he will, so he'll probably do a little less wheat this year.
"Around here, you've just got to stick with the rotation," he said. "Corn on corn doesn't seem to produce well in this area."
Solid export demand, feed demand and ethanol demand are also behind the market, officials said.
"There's good demand, supplies are down and exports are good, all of which results in good prices," said Steve Noyes, deputy director of the South Dakota Office of the National Agriculture Statistics Service in Sioux Falls. "It's not just one crop; it's across the board for both crops and livestock."
Prices typically rise in spring to nudge growers to commit acreages to various crops, Richardson said, but this year there's also strong speculation operating in the markets.
"There are billions of dollars from hedge funds out there and they will go to wherever they can make money," Richardson said.
Current farmer worries center around a possible La Nina weather cycle, which could bring a wet spring and dry August.
Stehly said he should be able to get all his crops in on time.
"We have enough moisture to hold the crop until July or August, so as long as we don't get excess moisture, we should be in good shape," he said.
Information from: The Daily Republic, http://www.mitchellrepublic.com
Copyright 2011 The Associated Press.