NEW YORK (AP) -- The price of corn touched a new two-year high Wednesday as questions remain about the available supply of the crop.
Corn prices have been on a nearly unchecked climb since late July and are approaching the psychological $5 a bushel level. The price of corn for December delivery rose as high as $4.975 a bushel during trading Wednesday before falling back to settle at $4.9525 a bushel. Corn rices have jumped more than 25 percent since the end of July.
Corn first began to rally over the summer, following wheat prices higher, which jumped on concerns about Russian production of the grain.
Now, though, investors are worried about the domestic harvest season for corn, which is driving prices higher. The Department of Agriculture's latest crop report last week also indicated supply this year would not be as big as previously forecast.
"We had a warmer, dryer August than would have been good for the crop," said Frank Cholly Sr., a senior market strategist at Lind-Waldock.
Cholly predicted production might not be as bad as recent estimates, which means prices could be reaching a near-term peak.
Another factor playing into the recent run-up in prices has been a record level of contracts purchased by noncommercial investors, like hedge funds. The price could retreat quickly if those investors begin to sell their contracts.
But there is no consensus among analysts about production levels.
"I don't think it's going to get any better," Jonn Sanow, an analyst with Telvent DTN in Omaha, Neb. said of production estimates. "If anything, it will get worse."
Wheat prices continued to pullback after hitting highs last month because of supply worries. December wheat contracts fell 9.25 cents to settle at $7.2675 a bushel.
Soybeans for November delivery rose 7 cents to $10.425 a bushel.
Meanwhile, metal prices were mixed. Gold backed off its record high set a day earlier. December gold fell $3.00 to settle at $1,268.70 an ounce. Silver rose 13.9 cents to $20.571 an ounce. Copper dipped less than a penny to $3.4665 a pound.
Energy contacts were mixed. Benchmark crude for October delivery lost 78 cents to settle at $76.02 a barrel on the New York Mercantile Exchange.
In other Nymex trading in October contracts, heating oil added 0.38 cent to settle at $2.1326 a gallon and gasoline fell 0.65 cent to settle at $1.9625 a gallon. Natural gas gained 2.9 cents to settle at $3.995 per 1,000 cubic feet.
