Chicago | Reuters – Chicago corn futures bounced higher on Tuesday, after a U.S. government crop conditions report showed good-to-excellent ratings for corn fell more than expected, raising concerns about the Midwest crop as it heads toward a key pollination phase of development.
Wheat futures rallied on short-covering and bargain buying after three straight sessions pushed the most-active contract Wv1 to its lowest since February. Soybean futures also were supported by a bigger-than-expected decline in crop conditions, and wider gains in financial markets after China eased COVID-19 rules for travellers.
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In a report released after Monday’s market close, the U.S. Department of Agriculture (USDA) cut its rating of the country’s corn crop in good-to-excellent shape to 67 percent, down 3 percentage points from a week ago, and lowered the soybean crop good/excellent score by 3 points to 65 percent.
The ratings decline suggests hot, dry weather earlier in June had some impact on corn and soybeans, although cooler conditions since last week have tempered crop concerns.
But some of Tuesday’s market movements were also due to traders jockeying for position ahead of Thursday’s key U.S. Department of Agriculture’s reports that will show how much farmers planted in the spring and what is left from last year’s harvest, said Don Roose, president of Iowa-based U.S. Commodities.
“It’s one of the top two or three reports of the year, and I would expect huge market price volatility after they come out,” Roose said.
The most-active corn contract on the Chicago Board of Trade (CBOT) corn Cv1 settled the day up 6-1/4 cents at $6.59-1/4 a bushel.
CBOT soybeans Sv1 settled up 29-3/4 cents at $14.62-1/2 a bushel, while CBOT wheat Wv1 closed up 18-1/2 cents to $9.36 a bushel.
– Additional reporting by Gus Trompiz in Paris, Hallie Gu and Dominique Patton in Beijing
