WASHINGTON — The U.S. Department of Agriculture yesterday reported that U.S. farmers would likely harvest 78.9 million acres of corn this year, down 8.7% from 2007, due partly to crop damage from recent flooding in the Midwest. However, the market for corn futures eased yesterday on the Chicago Board of Trade, indicating that traders expected much more damage, and had already priced those expectations into the market. According to the new report, farmers also appear to have exceeded the number of acres they were expected to plant this year, based on a poll that the USDA conducted in March. Corn prices have risen steeply during the past two years, driven partly by federal mandates for ethanol production, as well as growing demand for grains in developing countries. Since corn is a key component of animal feeds, the increases have hit meat and poultry producers hard.
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