CHICAGO: US grain and soybean futures extended losses on Tuesday as crops in the American Midwest were poised to benefit from rains, traders said.
Technical selling and better-than-expected US Department of Agriculture crop condition ratings added pressure on prices.
Showers in parts of the Midwest and Mississippi Delta temporarily eased concerns about the risk for damage to corn and soybeans from hot, dry weather.
Farmers are nervous about the health and size of their crops after heavy rains and flooding caused unprecedented delays in corn planting this spring. The planting problems left some crops with shallow root systems that make them more vulnerable to damage from unfavourable weather.
"Over the weekend there was concern about hot weather for US corn regions, but forecasts have now flipped," said Matt Ammermann, commodity risk manager for INTL FCStone.
"There is relief in the market about this. Continued rains are required by US corn, which is in a delicate state given the late plantings this year," Ammermann said.
Most-active December corn on the Chicago Board of Trade fell 7-3/4 cents, or 1.7pc, to $4.39-1/4 a bushel by 11:00 a.m. CDT (1600 GMT). Corn fell almost 3pc on Monday after hitting five-year highs.
Most-active November soybeans were down 13-3/4 cents, or 1.4pc, at $9.06-1/4 a bushel. September wheat dropped 1-3/4 cents, or 0.3pc, to $5.06 a bushel at the CBOT.
Follow-through selling added pressure on the markets after Monday's declines, traders said.
"These losses were instigated by technical selling yesterday, but improved weather outlooks added to the negativity," said Karl Setzer, commodity market risk analyst for AgriVisor.
The USDA surprised traders on Monday afternoon by raising its condition rating for US corn to 58pc good to excellent in a weekly report. That was up from 57pc a week earlier and above market expectations for 56pc.
US soybeans were rated 54pc good to excellent, up from 53pc last week and above analysts' expectations for 53pc.
"The trade is now expecting another improvement in the condition rating again next week with the improvement in the weather forecast," Tomm Pfitzenmaier, analyst for Summit Commodity Brokerage, said about corn.
The USDA said 57pc of the US winter wheat harvest was complete, up from 47pc last week but below expectations of 62pc. US spring wheat was rated 76pc good to excellent, behind market expectations of 78pc.
Comments
Comments are closed.