According to the USDA Plantings Intentions Report released on March 30, U.S. farmers will plant 90.5 million acres of corn this year — the largest amount of planted acres since 1944.

Although it's hard to believe, in 1944, American farmers planted 95 million acres of corn using only two-row planters. Most analysts would have never predicted the United States would be capable of planting this many acres of corn even with the well-advanced equipment we have today, but it looks like the American farmer might have just accomplished the unimaginable.

The two days following the March Plantings Intentions Report, the September 2007 corn market dropped 35 cents per bushel. Most analysts had predicted an increase of 10 million acres of corn planted, compared to the previous year (average market guess was 88.1 million). However, the report indicated a 12-million acre increase.

The corn market absorbed this acreage shock fairly quickly and began trading in a range of $3.60 to $3.90 versus September 2007 futures.

However, the beginning of the planting season in the Midwest was a wet one while the Southeast was faced with very dry conditions causing the market to trend upwards again.

Three weeks into the season, farmers across the country were running an average of 28 percent behind the planting pace of the year before. True to American producer form, these corn farmers were able to make up that deficit and actually surpass last year's pace.

In just two weeks, farmers planted 55 percent of the corn crop and pushed September corn futures back down to test the $3.60 level again.

The results of the good weather in the Midwest proved to be incredible. The market remained range-bound until June 11 when the weather market really emerged. The forecast on June 11 pushed drier and warmer conditions into the eastern Corn Belt sending September corn futures back into the $4.25 range.

During the week of June 18-22 a favorable six-day forecast ran the market back down to a close of $3.7675. This dramatic change demonstrates the fact that volatility will be the name of the game throughout the year and conditions can change fast. The one thing that is certain is the unpredictable weather market will be a huge factor the remainder of the summer for the corn market.

The two big uncertainties left for the U.S. corn crop for the rest of the growing season revolve around the June 29 Acreage Update Report and yield potential. Early estimates for the June 29 report were indicating an increase in the 100,000-acre range. However, when the USDA report was released, planted acres of corn came in at a staggering 92.88 million acres.

This was up 2.438 million acres from the March 30 Planting Intentions Report, which was the largest March to June acre increase ever.

The USDA's early yield estimate has the crop pegged at 150.3 bushels per acre. Current crop conditions would suggest a crop better than 150.3 bushels per acre, but the weather will impact these results in the next 45 days.

Using the USDA yield number of 150.3 bushels per acre, 2007-2008 ending stocks will be at 1.1 billion bushels of corn. Several years ago, ending stocks of more than 1 billion bushels would have meant the price for corn would be at $2.50 or below. With the current usage explosion related to ethanol, 1 billion bushels does not go quite as far as they used to.

A yield below 150 bushels per acre will not be acceptable to the market. A yield of 145.3 bushels per acre (which would have been a record three years ago) leaves the United States with only 713 million bushels of corn and potentially $5 per bushel.

A yield of 155.3 bushels per acre leaves the United States with 1.55 billion bushels of corn and potentially harvest lows in the $3 range.

The large increase in the amount of acres on the June 29 report is bearish to the market, but three weeks of hot and dry weather in July could change everything overnight. In the end, yield will be king this summer as it always has been.

The story of the 2007 corn crop is not even halfway though, but it has been a roller coaster nonetheless. Every weekly crop progress report will be looked at with more and more scrutiny as the U.S. corn crop moves toward pollination.

This market is a global market now and any problems the corn, soybean or wheat crops around the world have will have an effect on the U.S. corn market. The key factor in whether September corn is at $3 or $5 at harvest will be determined solely on the weather.

The question the American farmer must ask him/herself is — Have I done enough with my corn marketing to protect these prices? With input costs rising, protecting these higher-level prices is paramount for a successful year.

Corn put options are a wonderful tool to use in years of extreme volatility because they protect your downside while leaving your upside completely open. These options give a producer the ability to pencil in a worst-case scenario while at the same time allowing the producer to capture any possible market gains.

With the release of the June 29 Acreage Update Report, now is a great time to review the marketing plan of your operation and make the proper adjustments, if necessary.

The market will give producers many chances during the year to market their grain. Your success depends upon your knowledge of your marketing plan and your willingness to trade it whether that involves cash trades, options strategies, or pure hedges in the futures markets.