June 30, 2010

CBOT corn futures set for biggest monthly drop since March
 

Corn futures headed for the biggest monthly decline in three months as planting advances in the US, boosting expectations that the next harvest may exceed last year's record.

Corn for December delivery gained 0.4% at US$3.4525 a bushel on the Chicago Board of Trade at 11:15 a.m. Singapore time, set for an 8.8% decline this month. That will be the biggest monthly loss since March. The most active contract is little changed for the three months ended today, after declining for six of the last seven quarters.

"What the market is paying attention to is the improving crop conditions in America, the weather forecast which is favourable," Luke Mathews, a commodity strategist at Commonwealth Bank of Australia said. "That's likely to weigh on both commodities," he said, referring to corn and soy.

The USDA kept its estimate on the nation's corn production unchanged at 13.37 billion bushels in the year beginning September, with 88.8 million acres planted, beating last harvest's record of 13.11 billion bushels.

Soy for November delivery were little changed at US$9.13 a bushel at 12:23 p.m. Singapore time. The most active contract is set for a 2.6% decline this quarter.

Farmers are wrapping up planting of the soy crop after wet weather delayed seeding. Corn and spring-wheat seeding were completed earlier this month.