The fierce drought that has gripped the lower section of the US corn belt and has been ravaging both corn and soybeans in the region has sent corn futures limit up today and soybeans for the front month July contract to a new all time high. That has sent shudders through the minds of some traders who are convinced that it is only a matter of time before all of this feeds through to the supply chain. REsult - higher grain prices meaning higher food prices in general.
This phenomenon has gotten hedge funds back to buying commodities across the board this morning even with the equity markets careening lower. Gold and particularly silver are getting money inflows as a result.
I mentioned a while back that the old time traders used to see a connection between the price of soybeans and the price of silver. That connection seems to be back in full force today.