Corn and soybeans rose in Chicago on speculation yields may be lower than expected in the U.S., the world’s biggest grower of both crops, as dry weather persists in parts of the Midwest. Wheat gained.
Less than half the normal amount of rain fell in the past month in parts of Iowa, Illinois, Minnesota and Wisconsin, National Weather Service data show. While areas near the borders of those states may see more than an inch (2.5 centimeters) of rain in the next five days, regions further south and north will receive less, the forecaster said. Corn and soybeans rallied to records last year after drought damaged U.S. crops.
"U.S. traders are remaining cautious about the weather, as poor rains over the weekend in the U.S. crop belt threatened yields," said Arnaud Saulais, a broker at Starsupply Commodity Brokers in Nyon, Switzerland. "Besides, there are reports of some cooler weather that may increase the risk of frost in the medium term."
Corn for delivery in December added 1.8 percent to $4.72 a bushel at 5:20 a.m. on the Chicago Board of Trade, extending last week’s 2.3 percent climb. The U.S. Department of Agriculture cut its forecast for the domestic harvest last week to 13.76 billion bushels, down 1.3 percent from its previous monthly estimate while still the highest on record.
Soybeans for delivery in November gained 1.4 percent to $12.7725 a bushel. The oilseed touched $12.86, the highest level since July 23. Prices surged 6.5 percent last week, the most since July 2012. The USDA also cut its soybean production outlook last week to 3.26 billion bushels, smaller than analysts expected in a Bloomberg survey.
Both corn and soybean crops are maturing at a slower-than- normal pace after cool, wet weather delayed planting this season, USDA data show. Plants may be vulnerable to frost damage if the Midwest sees a cold snap before crops are harvested in September and October, forecaster DTN has said.
More than 120 analysts and traders will inspect fields across seven Midwest states as part of the annual Pro Farmer crop tour starting today. The farm newsletter will consider tour findings when it releases its forecast for U.S. output Aug. 23.
Wheat for delivery in December gained 1 percent to $6.50 a bushel. In Paris, milling wheat for delivery in November increased 0.5 percent to 184.75 euros ($246.40) a metric ton on NYSE Liffe.