June 29 (Bloomberg) -- Corn fell, extending the longest slump in three months, and soybeans declined on concern that economic growth in China will slow, reducing demand for livestock feed and food.
Chinese equities tumbled to a 14 month-low after the Conference Board revised down its April gauge for the economic outlook to indicate a weaker expansion. The Reuters/Jefferies CRB Index of 19 raw materials fell the most since August. China, the world’s top hog producer, is the biggest buyer of soybeans and the second-largest consumer of corn.
“The Chinese economy appears to be slowing, and that could have a lasting negative impact on grain demand,” said Jim Gerlach, the president of A/C Trading Inc. in Fowler, Indiana. “A global economic-growth problem is developing that will have a deflationary impact” on commodities, Gerlach said.
Corn futures for December delivery fell 8.75 cents, or 2.5 percent, to $3.44 a bushel on the Chicago Board of Trade. The price fell for the seventh straight session, the longest slide since mid-March. Earlier, the commodity touched $3.4325, the lowest level since June 9. The most-active futures have dropped 17 percent this year as Midwest rain boosted the yield potential of the U.S. crop.
Soybean futures for November delivery fell 6.5 cents, or 0.7 percent, to $9.12 a bushel on the CBOT. The oilseed has dropped 13 percent this year.
U.S. crop conditions may improve this week as rains replenish soil moisture in the southern U.S. and drier weather makes muddy fields in the Midwest more accessible to farm machinery used to spray for weeds and pests, Gerlach said.
The condition of the U.S. corn and soybean crops declined last week after parts of the Midwest got more than four times the normal amount of rain.
About 73 percent of the corn was in good or excellent condition as of June 27, down from 75 percent a week earlier and 77 percent two weeks ago, the U.S. Department of Agriculture said yesterday. An estimated 67 percent of soybeans got the best ratings, down from 69 percent last week and 75 percent on June 6.
“The crops should improve this week with the shift in the weather patterns,” Gerlach said. “There is little threat” until the middle of July, he said.
Corn is the biggest U.S. crop, valued at $48.6 billion in 2009, followed by soybeans at $31.8 billion, government figures show.
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