CHICAGO - U.S. corn futures slid to a one-week low on Tuesday and soybean futures lost ground, a day after a U.S. government report showed both crops were thriving.
Expectations that a privately run U.S. crop tour would uncover stronger yields in the coming days than on Monday, when it began, put additional pressure on prices, traders said.
Massive supplies of crops are a focus for traders as farmers will soon start bringing in harvests from their fields, adding to inventories already in storage.
The U.S. Department of Agriculture (USDA) helped fuel expectations for big harvests with a report on Monday that raised the corn crop's good-to-excellent rating by one percentage point. That surprised analysts and traders, who had generally expected a decline.
Crop ratings typically deteriorate heading into autumn, so the improvement weighed on prices, said Jim Gerlach, president of A/C Trading in Indiana.
ADVERTISEMENT
"I'd have to blame it solely on crop conditions," he said about the price move.
Chicago Board of Trade most-active corn dropped 1.5 percent to $3.37-1/4 a bushel. The contract earlier fell to $3.35-1/4, its lowest price since Aug. 16.
Soybeans slipped 0.2 percent to $10.13-1/2 a bushel, and wheat gave up 1.8 percent to $4.27-1/2 a bushel.
Traders estimated that funds were net sellers of about 7,000 to 13,000 corn contracts, 4,000 to 6,000 wheat contracts and zero to 1,000 soybean contracts.
The USDA surprised traders earlier this month by sharply raising its U.S. corn and soybean production forecasts, with average yields for both crops at a record high.
This week, they are assessing results from the annual Pro Farmer Midwest Crop Tour. Participants on Tuesday reported that corn and soybean fields in central and east-central Indiana were generally on track for bigger-than-average harvests.
That was a change from Monday, when scouts found harvest prospects for crops in South Dakota were lower than a year ago. They projected corn yields in Ohio would come in roughly unchanged from last year and below a three-year average.
"Scouts should start moving into much better-yielding areas as the tour progresses," said Kevin Van Trump, chief executive officer for agricultural consultancy Farm Direction.
ADVERTISEMENT
The tour ends on Thursday. Pro Farmer on Friday will release national corn and soybean crop estimates that incorporate what participants saw.
In Canada, a top wheat exporter, farmers are expected to harvest the second largest wheat crop in 25 years, a government agency said on Tuesday.
