Crops are doing so well that on Monday the Agriculture Department lowered its projected prices for wheat by 15 cents a bushel from a month ago and for corn and soybeans by 5 cents. Soybean prices will be the lowest they've been since the early 1970s. A pound of bread cost 14 cents in 1950. The slump in commodity prices is expected to have little impact on consumers because raw commodities generally account for only a fraction of the price of food. For example, farmers receive 7 cents of each dollar consumers spend on baked goods and cereal.
Analysts expect commodity prices to drop further, especially if the weather remains good.
U.S. Commodities Inc. Corn prices could drop another 20 cents a bushel as the growing season progresses, he said. The normal seasonal pattern would indicate we would get some more declines. The chairman of the House Agriculture Committee, Texas Republican Larry Combest, said earlier this month he wants to hold hearings before Congress decides how much money to distribute and in what form. Congress is going to have to act. The pressure is too great.