Commodities

GRAINS-Corn, soybeans, wheat drop as welcome rain forecast for U.S. crops

Credit: REUTERS/DANIEL ACKER

Chicago corn futures fell over 2% on Monday as new forecasts of rain in U.S. grain belts improved harvest prospects.

By Michael Hogan

HAMBURG, June 14 (Reuters) - Chicago corn futures fell over 2% on Monday as new forecasts of rain in U.S. grain belts improved harvest prospects.

Soybeans and wheat were also down sharply after the sudden weekend turnaround in U.S. weather forecasts.

Markets continued to be weakened by a Reuters report the U.S. may scale down biofuel blending in fossil fuels, possibly cutting demand for corn and soy-based blending ingredients.

Chicago Board of Trade most-active corn Cv1 fell 2.3% to $6.68-1/4 a bushel at 1051 GMT, after earlier on Monday hitting it lowest since June 3 at $6.53. New crop December corn CZ1 lost 3.9%.

Wheat Wv1 fell 2.3% to $6.65 a bushel, soybeans Sv1 fell 1.7% to $14.82-1/4 a bushel.

"Corn and soybeans are being weakened today by the sudden change over the weekend in extended weather forecasts in the U.S. Plains from hot and dry to cooler with more rain," said Matt Ammermann, StoneX commodity risk manager.

"Just how much importance the market is placing on U.S. corn and soybeans getting more rain is shown by the sharp drop in prices today. But extended weather forecasts can be changed so the dryness issue is not over yet."

Corn and soybeans are seeing downward pressure from the reports about the U.S. possibly reducing biofuel use, he said. But confirmation and more details were needed, especially as environmental protection is such a key part of the Biden administration's strategy.

July soyoil BON1 fell 3.8% and palm oil fell nearly 10% on Monday.

Consultancy Sovecon has raised its forecast of Russia's 2021 wheat harvest.

Wheat is seeing spillover weakness from falls in corn while rain in the U.S. would also benefit wheat," Ammermann added.

"Crop prospects in the EU and Black Sea are improving and the question is being posed about if and when the Russian government will allow the crop to be exported."

New crop corn futures took their biggest fall in a month on Monday as supply outlook improvedhttps://tmsnrt.rs/35fb3xm

Top U.S. corn state set for cooler temperatures, more rain for key corn crop growth phasehttps://tmsnrt.rs/3zhLSbc

(Reporting by Michael Hogan in Hamburg, additional reporting by Naveen Thukral in Singapore, editing by David Evans)

((michael.j.hogan@thomsonreuters.com; +49 172 671 36 54; Reuters Messaging: michael.hogan.thomsonreuters.com@reuters.net))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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