Soybeans Jump Most in Eight Months, Corn Rises as Rain May Cut U.S. Yields
Soybean futures jumped the most in eight months and corn closed at the highest price since January on speculation that heavy rain will reduce yields in the U.S., the world’s biggest grower and exporter of the crops.
In the Midwest, some fields got more than 10 inches (25 centimeters) of rain since June 7, or three times the normal amount, data from the Midwest Regional Climate Center show. The U.S. Department of Agriculture reduced its condition ratings for corn and soybeans for two straight weeks.
“The crops are now getting smaller,” said Don Roose, the president of U.S. Commodities Inc. in West Des Moines, Iowa. “There has been too much rain.”
Soybean futures for November delivery rose 32.5 cents, or 3.6 percent, to $9.325 a bushel on the Chicago Board of Trade, the biggest gain since Oct. 12. Earlier, the most-active contract reached $9.3575, the highest level since June 23.
Corn futures for December delivery rose 10 cents, or 2.6 percent, to $3.8925 a bushel, the highest settlement for the most-active contract since Jan. 12. The price gained 6.7 percent last week after the government said U.S. farmers planted less than they intended this year.
As of July 4, 71 percent of the corn crop was in good or excellent condition, down from 73 percent a week earlier, the USDA said yesterday. About 66 percent of soybeans got the best ratings, down from 75 percent three weeks ago.
Lower Yields
Based on yesterday’s USDA ratings, average corn yields may fall to 161.6 bushels an acre, according to Seth Meyer, an agricultural economist at the University of Missouri in Columbia. That would trail a projected 162.3 bushels a week earlier and a record 164.7 bushels last year. In June, the USDA forecast 163.5 bushels.
U.S. soybean yields may drop to 42.4 bushels an acre this year from the week-earlier projection of 42.7 bushels, Meyer said. In June, the USDA forecast that yields would decrease to 42.9 bushels on average from last year’s record 44 bushels.
“The excessive moisture in the Midwest seems to be reducing conditions and yields,” Meyer said in a report.
Corn is the biggest U.S. crop, valued at $48.6 billion in 2009, followed by soybeans at $31.8 billion, government figures show.
To contact the reporter on this story: Jeff Wilson in Chicago at jwilson29@bloomberg.net
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