June 29, 2011                                                                      

 

CBOT corn, soy gains as hot weather in the US threatens crops

 

 

CBOT corn advanced for a second day, extending the biggest gain in almost three months, and soy rose as above-normal temperatures in parts of the US threaten to stress crops that are already deteriorating.

 

December-delivery corn climbed as much as 2.3% to US$6.68 a bushel on the Chicago Board of Trade before trading at US$6.6275. The contract gained 4.2% yesterday, the most since April 1.

 

Above-normal temperatures and below-average rainfall across Mississippi Delta states and the southeastern part of the US may stress corn and soy crops, causing potential yield losses, Telvent DTN Inc. said in a forecast yesterday. The condition of the US corn, soy, wheat, and other crops deteriorated last week, according to the USDA.

 

"Supply concerns are starting to come to the fore again," Michael Creed, an agribusiness economist at the National Australia Bank Ltd., said by phone from Melbourne today. "There's still a fair bit of weather-related risk" to the next global harvests of corn, soy and wheat, he said.

 

About 68% of the corn crop in the US, the world's largest supplier, was in good or excellent condition as of June 26, down from 70% a week earlier and 73% a year earlier, the USDA said in a report on June 27.

 

Soy for November delivery gained as much as 0.8% to US$13.2975 a bushel in CBOT, before trading at US$13.2875.

 

An estimated 65% of the soy received the top ratings, down from 68% a week earlier and 67% a year earlier, the USDA said. Planting was 97% completed, compared with 94% a week earlier and 96%, on average, for the previous five years.

 

Wheat futures advanced for a second day, extending the biggest daily gain for the most-active contract since May 18. September-delivery wheat rose as much as 2% to US$6.85 a bushel in Chicago.

 

Two South Korean feed groups including the Major Feedmill Group are seeking bids to import as much as 220,000 tonnes of wheat for delivery in October and November at a tender today, according to a notice to suppliers.

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