Chicago corn and soyabean futures dropped sharply on Monday as hopes of Chinese buying fizzled and forecasts of cooler weather in the US Midwest eased concerns about crop yield losses. Wheat prices also were lower, pressured by bigger European yields, traders said. September corn futures on the Chicago Board Of Trade was down 8 cents, or 1.9% at $4.22-3/4 a bushel as of 11:23 am. CDT (1523 GMT), having gained 1.4% in the previous session.
Temperatures are beginning to cool across much of the Corn Belt after storms and extreme heat over the weekend threatened to curb US corn yields, according to Commodity Weather Group on Monday. But even if high temperatures return, the impact on pollination may not been too severe, said Karl Setzer, with Agrivisor. "The reason is the seed genetics are so much better than they were in the past," he said.
Large speculators raised their net long position in CBOT corn futures in the week to July 16, regulatory data released on Friday showed. Traders are also awaiting the US Department of Agriculture weekly crop progress report. Expectations are for no changes in good to excellent ratings from last week. The CBOT's August soyabean contract fell 11-3/4 cents, or 1.3% to $8.90-1/4 a bushel in mid-day trading on Monday.
Dealers said uncertainty about the ongoing trade tensions between the United States and China continued to weigh on prices. "The market has been hinged on the idea that China may announce the purchase of soyabeans," said Mike Zuzolo, of Global Commodity Analytics.
The CBOT's September wheat contract was down 9-3/4 cents, or 1.9% to $4.92-3/4 a bushel on Monday. The European Union is set for a larger wheat harvest this summer. A heat-wave in late June wilted some crops but had a less severe impact than initially feared, traders and industry officials said on Friday.