June 30 (Bloomberg) -- Corn fell the maximum permitted by the Chicago Board of Trade and wheat dropped the most in 13 weeks after the government said U.S. farmers planted more of both crops than previously expected.

Corn was sowed on 87.3 million acres, up 1.9 percent from a March forecast, and spring-wheat planting jumped 6.8 percent to 14.197 million acres, the U.S. Department of Agriculture said in a report today. Corn prices doubled in the past year to a record on June 27, and wheat jumped 13 percent this month after reaching a record in February. The U.S. is the world's largest corn grower and wheat exporter.

``When prices get that high, you find every nook and cranny to plant on,'' said Darrell Holaday, the president of Advanced Market Concepts in Manhattan, Kansas. ``This report sets a negative tone for the week.''

Corn futures for December delivery fell the CBOT's 30-cent limit, or 3.8 percent, to $7.57 a bushel, the biggest percentage drop since Jan. 23. The most-active contract reached a record $7.9925 on June 27. Corn is still up 26 percent this month, the biggest monthly gain since June 1988.

Wheat futures for September delivery fell 53.25 cents, or 5.8 percent, to $8.5875 a bushel in Chicago, the biggest drop since March 31. Futures have tumbled 36 percent from a record $13.495 a bushel on Feb. 27. The price is up 48 percent in the past 12 months after adverse weather curbed harvests in 2007.

Second-Biggest Crop

The corn planting exceeded the 85.2 million acres expected by 18 analysts surveyed by Bloomberg News. The acreage is the second-highest since 1944 after plantings last year surged to 93.6 million acres.

Corn growers increased seeding more than anticipated even after excessive rain in Iowa and Illinois, the largest producers of the grain, flooded fields and curbed yields, the USDA said. The report was based on a grower survey in the first two weeks of June and a special review last week of 1,200 farmers in Midwest areas ravaged by the worst floods since 1993.

``The number of acres farmers planted is larger than expected,'' said Greg Grow, a director of agribusiness for Archer Financial Services in Chicago. ``Now, the market will turn its attention to yields and growing conditions.''

After the close of trading, the USDA said in a separate report that the condition of the corn crop improved as sunshine and warmer weather dried some flooded fields. About 61 percent was considered good or excellent as of yesterday versus 59 percent a week earlier and 73 percent the prior year.

Drier Weather

Parts of the Midwest from Nebraska to Ohio got 25 percent of normal rain in the past week, allowing fields to drain and roots to push further into the soil, National Weather Service data show.

Corn also dropped today because U.S. inventories at the start of this month were larger than forecast, Grow said.

Stockpiles left over from last year's record harvest were 4.03 billion bushels as of June 1, up 14 percent from a year earlier, when supplies fell to a three-year low, USDA data showed. Analysts forecast 3.929 billion bushels, on average.

``Corn supplies are at least 100 million bushels higher than people expected,'' Grow said. ``This report indicates high prices are rationing demand.''

Corn is the biggest U.S. crop, valued at a record $52.1 billion in 2007, with soybeans in second place at $26.8 billion, government figures show. Wheat is the fourth-biggest U.S. crop, valued at $13.7 billion in 2007.

Spring Wheat

Growers are expected to harvest 13.8 million acres of spring wheat in the year that started June 1, up from 12.9 million the prior year, the USDA report said.

U.S. farmers may seed 63.5 million acres with all varieties of wheat in the year that ends May 31, a 5 percent jump from the prior year, the government said. Production in the U.S. is expected to increase to 2.43 billion bushels, or 66.2 million metric tons, in the marketing year, up 18 percent from the prior year, the USDA said on June 10.

About 74 percent of the newly seeded spring-wheat crop was in good or excellent condition as of yesterday, compared with 72 percent last week and 79 percent a year earlier, the government estimated.

Inventories of U.S. wheat may more than double to 13.3 million tons by May 31, the government said. Global inventories are expected to increase to 132.1 million tons, up from 115.1 million the prior year, the USDA said.

To contact the reporters on this story: Tony C. Dreibus in Chicago at Tdreibus@bloomberg.net; Jeff Wilson in Chicago at jwilson29@bloomberg.net.

Last Updated: June 30, 2008 17:57 EDT