Wheat futures fell, capping the biggest monthly drop since 2011, and corn declined to a 12-week low on signs that crop conditions improved in the U.S., the world’s top grain exporter.
As of May 25, 30 percent of the winter-wheat crop was in good or excellent condition, up from 29 percent a week earlier, according to the the U.S. Department of Agriculture. Areas of Texas, Oklahoma and central Kansas, where crops had suffered from drought, got an inch (2.5 centimeters) of rain in the past week, government data show. Accelerated planting in Canada and Ukraine supports the USDA’s forecast for world reserves to rise to a three-year high.
“Global grain supplies are on the rise, and that remains the biggest negative for the market,” Greg Grow, the director of agribusiness at Archer Financial Services Inc. in Chicago, said in a telephone interview. “There just are not any major weather problems developing.”
Wheat futures for July delivery dropped 0.8 percent to close at $6.2725 a bushel at 1:15 p.m. on the Chicago Board of Trade. Earlier, the price touched $6.255, the lowest for a most-active contract since March 4. This month, the price fell 13 percent, the most since September 2011.
Corn futures for July delivery declined 0.8 percent to $4.6575 a bushel after touching $4.65, the lowest since March 3. In May, the grain dropped 10 percent, the most in a year.
Soybean futures for July delivery declined 0.4 percent to $14.9325 a bushel. This month, the oilseed dropped 1.3 percent, snapping a three-month rally, the longest since August 2012.
U.S. farmers planted 88 percent of the corn crop as of May 25, matching the five-year average pace, and soybean seeding was 59 percent finished, up from 33 percent a week earlier, the USDA said on May 27.
Warmer, drier weather in the Midwest accelerated sowing and boosted crop development, T-Storm Weather LLC in Chicago said in a report. Widespread rain in the next two weeks was expected to boost soil moisture and aid plants.
The U.S. is the biggest corn and soybean producer, and domestic output is set to climb to records, the USDA said May 9.