US corn futures were on track for their biggest weekly decline in a year on improving prospects in the Midwest during the crop's key growth phase, raising expectations for a bumper harvest. Soyabean and wheat futures also fell on chart-based selling and spillover pressure from outside commodity markets, including metals and crude oil.
"It's now making it into the headlines of the financial press, the degree to which commodities are declining. That is a significant headwind for the grains," said Rich Feltes, director of research for R.J. O'Brien in Chicago. At the Chicago Board of Trade, as of 11:51 am CDT (1651 GMT), September corn was down 9 cents at $3.94-1/4 per bushel, dropping below its 200-day moving average. The contract has not settled below $4 since June 29.
For the week, corn was down about 6 percent, the biggest slide for a front-month contract since July 2014. CBOT August soyabeans were down 14-1/2 cents at $9.95-1/2 per bushel and September wheat was down 7-1/4 cents at $5.14-1/4 a bushel. Weather conditions have been mostly favorable this week in the heart of the US Corn Belt as the crop continues to pollinate, a crucial stage for determining corn yield. The United States is the world's top corn producer and exporter.
"There is a general expectation that the crop ratings are going to be higher on Monday," Feltes said, adding, "When the market perceives the crop is improving, prices are going to decline." Soyabean futures followed corn lower on benign weather and technical selling, with the spot August contract dropping below its 200-day moving average. Wheat sagged on dollar strength and indications that US wheat remains uncompetitive on the world market.
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