Corn rises more than 1% as crop conditions worsen in US; Wheat status

Chicago corn rose more than 1% on Tuesday after a weekly government report showed a sharp decline in estimates of the U.S. crop amid hot and dry weather in parts of the Midwest grain belt.

Wheat rose for a fifth straight session on support from tightening global milling wheat supplies, with Australia expecting a smaller harvest in 2023/24.

Basics

* By 0028 GMT, the most active corn contract on the Chicago Board of Trade (CBOT) was up 1.1% at $6.03-3/4 a bushel. Wheat added 0.9% to $6.29-1/2 a bushel and soybeans rose 0.7% to $13.59.

* The United States Department of Agriculture (USDA) estimated 64% of the U.S. corn crop was in good condition in its weekly crop progress report on Monday, down 5 percentage points from a week ago and below the lowest estimate in a Reuters poll.

* After the market closed on Monday, the company estimated the soybean crop was good at 62% in its first 2023 oilseeds status report, below most trade expectations. The United States is the world’s second largest exporter of corn and soybeans, after top supplier Brazil.

* However, weak demand for US grains and oilseeds limited the potential upside in prices. The USDA said Monday that weekly corn export surveys fell to 1.180 million tons from 1.346 million tons the previous week.

* Soybean export surveys were reported at 214,247 metric tons, down 11.9% from the previous week.

* Australian winter crop production is set to fall from record highs, according to the country’s agriculture department, as forecasters predict drier weather after three years of record rains due to persistent La Nina weather patterns.

* Total Australian production of winter crops, including wheat, is expected to fall 34% to 44.9 million tonnes in 2023-24, about 3% below the 10-year average for 2022-23, according to the June harvest. A report by the Ministry of Agriculture, Fisheries and Forestry.

* The European Commission said on Monday it would extend a plan to allow Ukraine’s five EU neighbors to restrict Ukrainian grain imports until September 15.

* Commodity funds were net sellers of CBOT corn, soybean and soybean oil futures on Monday, and net buyers of soybean meal and wheat, traders said.

Market news

* Global stocks and the dollar fell on Monday as investors wondered whether the Federal Reserve would raise rates in June after last week’s showing of slowing U.S. wage growth, while oil prices were steady after a big output cut promised by Saudi Arabia.

Data/Events (GMT) 0430 Australia RBA Cash Rate June 0600 Germany Industrial Orders MM April 0600 Germany Manufacturing O/P Cur Price SA April 0600 Germany Consumer Goods SA April 0830 UK All Sector PMI Revised by Sahu)