Chicago | Reuters — U.S. corn futures scaled to their highest in a year on Friday as soggy U.S. Midwest field conditions and forecasts for unrelenting rain across the region heightened concerns that farmers may be unable to plant a sizable portion of the crop.
Soybeans followed corn higher, also supported by worries about planting this year’s crop.
Wheat rose as well, lifted by short-covering ahead of the long Memorial Day holiday weekend in the U.S., which will keep markets shuttered on Monday.
Above-normal rainfall is expected across most of the Midwest and Plains farm belt over the next 15 days, further delaying planting of corn and soybeans and potentially damaging the quality of the developing winter wheat crop, forecasters said.
“There are forecasts for the central Midwestern corn belt getting rain for the next two weeks,” said Tomm Pfitzenmaier, analyst for Summit Commodity Brokerage in Iowa.
“They’re not just worried about getting corn planted. They’re definitely worried about soybeans not getting planted as well,” he said.
Some farmers delayed by weather are expected to still plant corn or soy after final planting deadlines specified in crop insurance policies, after which coverage levels begin to decline. Later planting can also drag down yield potential.
A Trump administration farm aid package announced on Thursday requires that farmers plant something to collect any benefit.
Chicago Board of Trade (CBOT) July corn was 14-1/2 cents higher at $4.04-1/4 per bushel, the highest price for a most-active contract since May 29, 2018 (all figures US$). The contract posted a 5.5 per cent weekly gain after rising almost nine per cent last week.
Buying in July corn accelerated as the contract broke through chart resistance at the $4-per-bushel mark, a level that a spot corn contract has not topped in a year.
July soybeans were up 8-1/4 cents at $8.29-3/4 a bushel, rising one per cent in the week.
CBOT July wheat jumped 19-1/4 cents to $4.89-1/2 a bushel for a 5.3 per cent weekly jump.
Both soybeans and wheat posted their second straight weekly gains after sinking in each of the previous five weeks.
Remarks by Trump on Thursday, in which he predicted a swift end to the trade war with China, also lent some support to soybeans and wider markets after a period of increased tension in discussions between Washington and Beijing.
— Reporting for Reuters by Karl Plume in Chicago; additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore.