(Bloomberg) – Corn dropped, poised for the biggest monthly decline in almost three years, on expectations supplies will be ample amid an outlook for a bumper harvest in the U.S., the top grower. Wheat also fell.
U.S. corn crops are maturing in mostly good condition, boosting prospects that output may reach the U.S. Department of Agriculture’s forecast of 13.86 billion bushels, the second-highest ever. Rain is set to increase in August after dryness developed in some areas late this month, forecaster WeatherBELL Analytics LLC said.
“The weather is perfect in the growing areas of the U.S. Midwest, meaning that high yields are anticipated,” Carsten Fritsch, an analyst at Commerzbank AG, said in an e-mailed report. “What is more, rainfall is forecast for the next few days, which should dispel any fears that crop yields might be impaired by overly dry conditions.”
Corn for December delivery fell 0.4 percent to $3.70 a bushel by 7:01 a.m. on the Chicago Board of Trade. Prices are set to slump 13 percent in July, a third straight monthly drop and the biggest decline since September 2011.
Seventy-five percent of corn in the main U.S. growing areas was in good or excellent condition as of July 27, the best shape for the date since 2004, USDA data show. Soybean crops, rated 71 percent in top condition, were in the best shape for this time of year since 1994. The USDA expects the soybean harvest to rise to a record 3.8 billion bushels.
U.S. Crop
Good U.S. crop conditions have spurred speculators to cut bets on rising prices, said Wayne Gordon, an analyst at UBS AG in Singapore. Bullish net-long positions in corn fell to 70,408 contracts in the week through July 22, the lowest since February, U.S. Commodity Futures Trading Commission data show. Money managers became net-short in soybeans in the week-ended July 15 for the first time since December 2011.
Wheat for delivery in September fell 0.5 percent to $5.2475 a bushel, also poised for a third straight monthly loss. In Paris, milling wheat for November delivery declined 1.9 percent to 172.25 euros ($230.47) a metric ton on Euronext.
Egypt, the world’s top wheat importer, bought 175,000 tons of Russian grain yesterday, shunning U.S. supplies. No offers were submitted to Egypt’s tender for supplies from France, according to two traders involved who asked not to be identified because they’re not authorized to speak to media. French soft wheat exports, the European Union’s biggest, are at risk of falling after grain cooperatives reported rain spoiled grain quality across the east and north of the country.
Soybeans for November delivery rose 0.1 percent to $10.82 a bushel, also set for a third monthly retreat.
