Corn Futures Drop to Lowest Level in Four Months

For the fourth straight session corn futures fell, dropping as low as $5.26 earlier in the day, the lowest level in four months on the CBOT.

The major driver of the drop is the cooling weather, as pollination will increase in response to cooler weather conditions, increasing corn yields. This helps to address the opposite concerns that hot weather would cause corn prices to surge through an even lower pollination rate.

"A forecast for relatively cooler weather this week will be beneficial for" corn's pollination, said Elaine Kub, a grain analyst at commodities research firm DTN.

Even so, according to the U.S. Department of Agriculture, as of August 3, pollination of corn was down from the five-year average of 91 percent, with 83 percent pollinating at this time. The cooler weather will increase that percentage, and probably bring it closer in line with past performance.

Another factor is the strengthening U.S. dollar, which has brought downward pressure on commodities in general, including corn.