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Corn falls to near two-week low on positive U.S. crop condition

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By Melanie Burton

MELBOURNE, June 21 (Reuters) – U.S. corn fell to its lowest in more than a fortnight on Tuesday after the U.S. Department of Agriculture rated the Midwest corn crop in better condition than the market had anticipated after a spate of hot weather.

The U.S. Department of Agriculture’s weekly crop progress report rated 75 percent of the corn crop in good to excellent condition, unchanged from the previous week. Analysts surveyed by Reuters had expected a decline after a hot week.

“We continue to see weather driving the market. It’s been much hotter and drier in the U.S in the past few days and the outlook is maybe turning a little more favourable (for growing), and that’s why we are seeing markets trading a little bit lower,” said Graydon Chong, an analyst with Rabobank in Sydney.

U.S. corn Cv1 futures fell 0.6 percent to $4.18-3/4 a bushel by 0333 GMT at the Chicago Board of Trade (CBOT), extending Monday’s 3.8 percent decline following forecasts for much-needed rains in the U.S. Midwest. Prices fell to as low as $4.18, the lowest since June 3.

Speculators raised their net-long positions in the CBOT corn futures in the week to June 14 by 44,327 futures and options contracts, data released on Friday showed.

“We have seen little liquidation of that long position,” Chong added.

Elsewhere, U.S. wheat futures Wv1 rose 0.1 percent to $4.73-1/2 a bushel, with small gains also seen in soy futures Sv1 which rose 0.1 percent to $11.33-3/4 a bushel.

The USDA rated 73 percent of U.S. soybeans as good to excellent, down from 74 percent a week earlier and in line with trade expectations.

Commodity funds were net sellers of Chicago Board of Trade corn, soybean and wheat futures contracts on Monday, traders said. CBOT/FUNDS

Trade estimates of fund selling in corn ranged widely from 9,000 to 25,000 contracts, in soybeans from 6,000 to 10,000 contracts and in wheat from 3,000 to 5,000 contracts.

In wider markets, the dollar paused for breath after a risk on rally on Monday, after latest polls released over the weekend showed the “Remain” camp in the lead, reversing a recent rise in support for Britain pulling out of the European Union.

GRAINS-Corn jumps 2.5 pct on supply concerns; soybeans, corn firm

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  • Corn up 2.5 pct in biggest 1-day gain in a month, soy rises
  • USDA cuts ending stocks outlook, funds continue to buy

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By Naveen Thukral

SINGAPORE, June 13 (Reuters) – U.S. corn rallied 2.5 percent on Monday and soybeans gained almost 1 percent, with prices supported by concerns over a severe drought in Brazil and unseasonal rains in Argentina curbing global supplies.

Wheat rose, tracking gains in corn and soybeans, although prices were capped by expectations of a bumper harvest of the U.S. winter crop.

“Funds are continuing with their bullish bets on corn and soybean markets,” said Kaname Gokon at brokerage Okato Shoji in Tokyo.

“The USDA has cut its estimates for ending stocks as there is strong demand for U.S. products.”

The Chicago Board of Trade most-active corn contract Cv1 was up 2.5 percent at $4.33-1/2 a bushel by 0217 GMT, its biggest one-day gain since mid-May. Soybeans Sv1 added 0.9 percent to $11.88-3/4 a bushel.

Wheat Wv1 rose 0.7 percent to $4.98-1/2 a bushel.

Agricultural markets have been showing bullish momentum since April as a severe drought has hit Brazilian corn production, while heavy rains have swamped Argentina’s soybean crop.

Domestic supplies of corn and soybeans will be tighter than expected in the United States as problems with crops in Brazil and Argentina have raised demand for U.S. supplies from overseas buyers, the U.S. Department of Agriculture said on Friday.

In its monthly supply and demand report, the government cut its new-crop and old-crop ending stocks outlooks for both corn and soybeans by more than analysts had forecast.

For corn, the USDA said U.S. ending stocks for 2015/16 would be 1.708 billion bushels, down from its May outlook for 1.803 billion bushels. It lowered its 2016/17 corn end stocks view to 2.008 billion bushels from 2.153 billion bushels.

Old-crop soybean stocks were cut to 370 million bushels from 400 million bushels. New-crop soy stocks were lowered to 260 million bushels from 305 million bushels.

The market will focus now on what the USDA will say on June 30, when it releases its estimates for U.S. quarterly grain stocks and planted acres. It will also keep a close eye on the weather that could threaten recently planted U.S. corn and soybean crops.

Large speculators raised their net long position in CBOT corn futures in the week to June. 7, regulatory data released on Friday showed.

The Commodity Futures Trading Commission’s weekly commitments of traders report also showed that noncommercial traders, a category that includes hedge funds, trimmed their net short position in CBOT wheat and raised their net long position in soybeans.