"U.S. corn yields have been below trend for three years, and more farmers now recognize the possibility of four poor crops in a row," Hurt said. "This, of course, means that normal crops and sharply lower prices are far from a reality. Prices won't move sharply lower until crop production becomes more assured as the 2013 season progresses."

Futures markets already are taking into account the possibility of a short 2013 corn crop and building in a greater-than-normal weather risk premium. While the amount of the premium is unknown, Hurt said 50 cents to $1 per bushel isn't out of the question.

"As long as the drought threat remains as large as it is today, new-crop corn prices could stay higher by the risk premium," he said. "If the drought risk were to be eliminated, then new-crop prices would likely drop.

"The weather threat could be reduced if more rain arrives but can't be eliminated until next year's corn growing season reaches mid- to late July."

So while a return to normal production could mean $5.50-per-bushel corn, Hurt said continued drought in key production states could still translate to new-crop corn prices of $8.50 per bushel.

The uncertainty makes risk management difficult for corn growers.

"Farmers will have three key tools to deal with the financial risk from this wide range of possible outcomes: federal crop insurance, the new government farm program and their own marketing decisions," Hurt said.