U.S. corn futures continue to rise on drought

Chicago Board of Trade corn futures were higher on Friday on continued deterioration of the U.S. corn crop as the worst drought in over a half a century takes a toll on crop production. 

Informa Economics cut its estimate for 2012 corn yield to 134.0 bushels per acre from the previous 142.5 and trimmed soy yield to 38.5 from the previous 40.0.

Crops in the northern and eastern U.S. Midwest will benefit from showers and cooler temperatures over the next week but heat and drought will continue to punish crops in the southwest, an agricultural meteorologist said on Friday. "There will be additional rain in the eastern Midwest today and showers in the northwest tomorrow and Sunday," said Don Keeney, meteorologist for MDA EarthSat Weather.

Corn yield prospects in central and northeast Iowa were highly variable as drought and periods of extreme heat this summer diminished production potential, scouts on an MDA EarthSat Weather tour of the Midwest said.

Taiwanese feed millers have bought 60,000 tonnes of Brazilian corn, paying $340 a tonne, including cost and freight, or at least 20 percent more than the price being offered in June in Asia, traders said on Friday.

September is above all key moving averages. The nine-day RSI is at 70.

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