Corn headed for the longest slump since February as warm weather and ample soil moisture improved prospects for a record crop in the U.S., the world’s largest grower. Wheat dropped to a 12-week low, and soybeans slid.
Hot, dry weather over the next 10 days will help evaporate excessive soil moisture from Minnesota to Illinois, where some areas got more than three times the normal amount of rain in the past month, Commodity Weather Group LLC said today in a report. About 65 percent of the corn and soybean crops were in good or excellent condition on June 23, up from 64 percent a week earlier, U.S. Department of Agriculture data show.
“The crops are responding to improving weather conditions, reducing the market’s concerns about flooded fields in parts of the Midwest,” Brian Grete, the senior market analyst for Professional Farmers of America newsletter in Cedar Falls, Iowa, said in a telephone interview. “Two thirds of the corn and soybean crops are good shape, and that has people anticipating big U.S. crops.”
Corn futures for delivery in December, after the harvest, fell 2.2 percent to $5.265 a bushel at 10:07 a.m. on the Chicago Board of Trade. Prices are down 7.7 percent over a seven-session slump that is the longest since Feb. 14.
Some of the debate about the size of U.S. plantings will be answered later today when the USDA updates its estimate at 12 p.m. in Washington, along with its first forecast of how much land will be harvested, Grete said.
Farmers probably sowed 95.431 million acres (38.6 million hectares), or 1.9 percent less than 97.282 million the USDA estimated in March, a Bloomberg survey showed. Soybean acreage may rise to 77.811 million, compared with a March estimate of 77.126 million, after rains forced some growers to switch from corn, which loses yield when planted late, the survey showed.
U.S. corn output may jump 25 percent this year, rebounding from last year’s drought-damaged crop, even as acreage declines, Rabobank International said today.
“Improved planting progress and favorable crop conditions throughout June have lessened the likelihood of a repeat production disaster,” Rabobank wrote. “The skew of our price forecasts has turned more bearish.”
Wheat futures for delivery in September slipped 0.7 percent to $6.6875 a bushel on the CBOT, heading for a seventh straight decline and the longest slump since December. Earlier, the price reached $6.675, the lowest for a most-active contract since April 2. The grain is down 5.2 percent for the month.
Soybean futures for delivery in November dropped 0.9 percent to $12.6325 a bushel in Chicago, heading for a third straight decline.