US corn futures surged the daily 40-cent limit early on Monday, jumping to their highest since early February, as hot and dry weather in the big US Midwest growing region reduced the outlook for yields. Corn futures for December delivery were headed for their biggest daily gain in the life of the contract at the Chicago Board of Trade while new-crop soyabean futures advanced more than 3 percent after weekend rainfall disappointed and the extended forecast remained hot and dry.
Grain futures bucked pressure from a firm dollar, lower equities and a sharp drop in crude oil. "The rainfall over the weekend was a bust. We thought we might see some scattered showers and that did not come through," said Citigroup analyst Sterling Smith in Chicago. "If we see these outside markets turn around, these grains could really catch fire."
Analysts polled by Reuters predicted the US Agriculture Department would reduce US corn and soyabean crop ratings late Monday by 2 to 3 percentage points while there was little rain in sight for the next 10 days. CBOT December corn was limit up at $5.94 cents per bushel, a gain of 7 percent. New-crop November soyabeans rose 3.6 percent, or 50 cents, to $14.25-1/2 per bushel. Wheat futures joined the rally, buoyed additionally by diminished crop prospects in the Black Sea region. Wheat prices also rose, with CBOT July up 27-1/2 cents or 4 percent at $7.00-3/4 a bushel.
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