|20 August, 2019

Corn rebounds as crop tour estimates lower U.S. yields

The most-active corn contract on the Chicago Board of Trade was up 0.7% at $3.77-1/4 a bushel

Image used for illustrative purpose. A farmer processes corn cobs on September 6, 2008 in Pengzhou of Sichuan Province, China.

Image used for illustrative purpose. A farmer processes corn cobs on September 6, 2008 in Pengzhou of Sichuan Province, China.

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SINGAPORE  - Chicago corn futures rose on Tuesday, recouping some of previous session's heavy losses, when a U.S. crop tour forecast below-average yields after a wet spring delayed plantings. 

Wheat edged higher, although gains were capped by ample global supplies from the recently harvest Northern Hemisphere crop.

The most-active corn contract on the Chicago Board of Trade was up 0.7% at $3.77-1/4 a bushel, as of 0248 GMT, wheat gained 0.2% to $4.73-1/2 a bushel and soybeans added 0.5% to $8.71 a bushel.

"Pro-farmer crop tour is finding lower yields and there is a good chance that the U.S. corn crop is lower than the current USDA estimate," said Ole Houe, director of advisory services at brokerage IKON Commodities.

"I think it will support prices in the longer run and it may take 6-8 weeks for it to flow through."

For the 2019/20 crop year, the U.S. Department of Agriculture (USDA) last week estimated the corn crop at 13.901 billion bushels, based on an average yield of 169.5 bushels per acre.

Scouts travelling on a crop tour in the U.S. Midwest on Monday found corn yield potential was below average after a wet spring delayed plantings.

Corn yields in Ohio were projected sharply lower than a year ago at 154.35 bushels per acre, the Pro Farmer Midwest Crop Tour said on Monday.

In South Dakota, the tour estimated corn yields at 154.08 bushels per acre, down from 178.01 bpa last year and the tour's three-year average of 158.59 bpa.

The USDA in a weekly crop progress report rated 56% of the U.S. corn crop and 53% of U.S. soybeans in good-to-excellent condition, down from 57% and 54%, respectively, a week earlier.

Analysts surveyed by Reuters on average had expected no change for ratings of either crop. 

Commodity funds were net sellers of CBOT corn, soybean, soyoil, wheat and soymeal futures contracts on Monday, traders said.    

(Reporting by Naveen Thukral, Editing by Sherry Jacob-Phillips)

© Reuters News 2019

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