US corn futures rallied more than 1 percent o n Friday to a two-week high as tight supplies and worries about crop-stressing weather across the US Midwest this weekend offset pressure from a firm dollar and weakness in broader financial markets. Corn was on pace for its strongest weekly advance in more than a year.
Wheat fell 1 percent as the same hot, dry weather that lifted corn was seen supporting a brisk harvest pace for the winter crop. Soybeans mostly declined following a three-day rally, the strongest in nearly eight months. The oilseed remained in position for its biggest weekly gains since March, helped by tight stocks and strong export demand from China.
Corn turned higher at midmorning, bucking early pressure from worries about a deepening euro zone debt crisis and slower economic growth in Germany and China that pressured broader financial markets and lifted the dollar. Temperatures are expected to reach the 90s (Fahrenheit) in much of the Corn Belt this weekend with only light rains, extending a crop-stressing pattern that has raised worries that yields may not live up to initial forecasts.
"The early attempt to push corn down fell flat. There are growing production concerns about the weather remaining dry and temperatures rising across much of the central US this weekend," said Shawn McCambridge, analyst with Jefferies Bache. "Wheat is heading into a harvest weekend. The same hot, dry conditions that are concerning corn are benefiting wheat, bringing the grain to harvestable levels in terms of moisture and supporting a rapid pace of harvest." Chicago Board of Trade July corn rose for a third straight session, gaining 8-1/2 cents, or 1.4 percent, to $6.02-1/2 per bushel by 11:44 am CDT (1644 GMT).
New-crop December corn added 5-1/2 cents, or 1 percent, at $5.42. "We've been coming up short on the rain. The last seven days have not been that abundant on moisture so I would assume we could have crop ratings decline," said Mark Schultz, chief analyst with Northstar Commodities. Soybeans slid despite a US Department of Agriculture announcement o n Friday that private exporters had sold 530,000 tonnes of US soybeans, mostly to China.
Hot, dry Midwest weather could also stress recently planted soybeans, but the more advanced corn crop is more vulnerable than soybeans, which have plenty of time to recover. CBOT July soybeans rose 1-1/2 cents, or 0.1 percent, to $14.29-1/2 per bushel while new-crop November shed 10 cents, or 0.75 percent, to $13.31-1/4. CBOT July wheat dropped 7 cents, or 1.1 percent, to $6.34-3/4 a bushel.