(Reuters) – Chicago soybeans rallied for a second session on Tuesday to a one-week high as forecasts of dry weather in the U.S. crop belt next month and strong demand from top importer China buoyed the market.
Corn rose around half a percent as the market recovered from losses earlier in the session, tracking gains in soybeans, while wheat edged higher after a two-day decline.
Chicago Board of Trade most-active soybean contract gained 1.8 percent at $11.25 a bushel by 0707 GMT. Earlier on Tuesday, they hit the highest since June 21 at $11.29-3/4 a bushel.
Corn added 0.6 percent to $3.96-1/2 a bushel, while Wheat gained 0.6 percent to $4.61 a bushel.
Soybeans were underpinned by forecasts of a return to hot temperatures in the second half of July in parts of the U.S. Midwest.
After the CBOT closed on Monday, the U.S. Department of Agriculture rated 72 percent of the U.S. soybean crop in good to excellent condition, down from 73 percent the previous week and in line with analyst expectations.
The agency in a separate report confirmed sales of another 150,000 tonnes of U.S. soybeans to unknown destinations on Monday, following sales announcements of more than 400,000 tonnes on Friday.
The USDA rated 75 percent of the U.S. corn crop as good to excellent, bucking expectations for a downgrade. [US/COR]
“U.S. corn conditions came in unchanged on the previous week, so prices struggled,” said Tobin Gorey, director of agricultural strategy at Commonwealth Bank of Australia.
“Some of the driest areas of the U.S. Midwest received rain over the weekend. The Delta and Southeast mostly trended drier, but meteorologists say the region should see widespread precipitation today.”
Wheat futures have faced headwinds from reports of large yields from the U.S. winter crop.
U.S. farmers have finished harvesting 45 percent of the winter crop as compared with 25 percent a week ago and above the five-year average of 41 percent, the USDA said.
The USDA is set to release closely watched stocks and plantings estimates on Thursday.
Those reports will show the extent to which brisk export demand has whittled down corn and soybean inventories, and whether farmers planted more soybeans and less corn than initially expected due to a spring rally in soy prices.
Commodity funds were net buyers of CBOT soybean futures contracts on Monday and net sellers of corn and wheat.
