Corn Usage in Life and Corn Prices in Commodity Market

Corn Usage in Life and Corn Prices in Commodity Market

We already realize how corn important in human being life, therefore, we can answer why corn prices is changeable up and down, which factors make this change. Let's us analyze its usage to make clear this matter.

Corn prices refer to corn futures in price which is discuss in the present but receiving bushes in specific futures. Corn is the major product of feed grain in US around 90% of total production. With the vast of capacity, how can corn be used? They are mainly used to feed livestock and the remaining for multitude of food and other industrial products.

Why corn price is moving up and down? The reason is depending on ethanol demand, corn and oil can be used to produce ethanol. If the profit from selling ethanol is higher than the cost of oil and corn around 90%, the corn price is moving and vice versa.

As we know, biofuels manufacturing also makes the demand of corn increasing. This factor put this corn commodity prices in pressure and also on using of land for food production.

One more reason for high demand corn commodity is that corn uses for animal feed. Some countries in Asia where there is developing in animal industry, also makes pressure on corn prices. During 2009-2014, some surveys show that China will need over 100million tones of corn. Besides, the demand of milk also contribute on the corn supply, people have to extend their land to grow more to keep up with the milk consumption so that cow can produce milk.

The growth of populations also contributes in corn commodity prices. The more people raise , the more food demand they need such as, meat, wheat and corn- hungry. Large international companies do business on wheat and corn to make plans in searching corn resource in the long-term.

Another thing affect on corn price is depending on the value of the U.S dollar. Actually, US dollar is one of the main currencies in international market. USD rate exchanges also partly influence in import and export corn between countries and countries.

Corn futures transaction how many months per year? The answer is that it is in March, May, July, September and December.

In conclusion, corn and other agricultural commodities are very important in our life. To do business on corn commodity, we must understand the current demand and supply ability at that time based on analyzing the situation in the market to make decision and to earn profit from corn prices.

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