Grain prices will climb in the first half of 2013 and then beat a retreat as production recovers from weather disasters and creates a global surplus, Rabobank said on Wednesday.

Corn and soybean prices soared to record highs during the summer as the worst U.S. drought in more than 50 years devastated crops and tightened supplies.

Prices have since pulled back but need to move higher again in the first quarter of 2013 to slow demand for limited supplies, Rabobank said in an annual outlook report.

The jump in prices early next year will encourage farmers to increase production, “resulting in a rebalancing of fundamentals and weaker price outlook in the second half of 2013,” the bank said.

Rabobank predicted Chicago Board of Trade (CBOT) corn prices will average $7.90 a bushel in the first quarter and then fall 24% to $6 during the U.S. harvest in the fourth quarter. Front-month December corn on Wednesday traded around $7.60 on the Chicago Board of Trade.

Soybean prices are expected to average $14.75 in the first quarter before sliding almost 12% to $13 in the fourth quarter next year. Nearby January soybeans on Wednesday traded around $14.45.

CBOT wheat prices are forecast to rise to $9.10 in the first quarter of 2013 and then fall 23% to $7 by the fourth quarter, according to Rabobank. Nearby December wheat on Wednesday traded around $8.80.

In its outlook for 2012, Rabobank said, it underestimated some prices by as much as 30% due to the unforeseen impact of the drought in the United States, which accounts for one-third of global corn exports.

A year ago, the bank forecast corn prices at the end of 2012 would average $6.10, wheat prices would average $5.95, and soybean prices would average $12.51.