Relentless heat in the key US corn- and soybean-growing areas drove benchmark Chicago corn futures to a contract high early on Tuesday, and soybean prices jumped to their highest levels since 2008, as worries grew over the impact of drought on world grain supplies. US wheat hit its highest price in over a year, tracking corn's rally.
The US Department of Agriculture (USDA) on Monday slashed its condition rating for US corn to 48 percent good-to-excellent, down 8 percentage points from a week earlier. It pegged the soybean crop at 45 percent good-to-excellent, compared with 53 percent a week ago. The long-range forecast offered some mild relief as cooler weather is expected next week in the US grain belt.
Chicago Board of Trade December corn gained 17-1/2 US cents, or 2.7 percent, to $6.73-1/4 a bushel by 10:58 am CDT (1558 GMT), just slightly below its fresh contract high of $6.76. The most active November soybean contract rose to a contract high of $14.70-1/2 a bushel, while the spot month reached the highest price since July 2008. Nearby July soybeans were up 31-1/4 cents, or 2 percent, to $15.63-1/2 per bushel. September wheat gained 17-1/4 cents, or 2.2 percent, to $7.89-3/4 a bushel. On a continuation chart, front-month wheat climbed to $7.77 per bushel, its highest since June last year.