U.S. corn fell to a near two-year low in first week of August, slipping for a second session after the U.S. Department of Agriculture pegged the condition of the crop at above market expectations. Soybeans fell more than 0.5 percent to hit a three-and-a-half month low, while wheat was little changed.
Analysts said corn was coming under pressure as any lingering weather related supply concerns ease. “The proportion of U.S corn rated in good to excellent condition added to the bearish tone,” said Tobin Gorey, director of agricultural strategy, Commonwealth Bank of Australia, adding that updated weather models are also favourable.
“While corn is not yet totally in the clear, the window for significant weather related losses is quickly closing.”
The USDA rated 76 percent of the corn crop as good to excellent, unchanged from the week before and ahead of analyst forecasts. The outlook is increasing market confidence of bumper U.S. corn production.
Commodity brokerage INTL FCStone projected U.S. 2016 corn production at 15.146 billion bushels, a record high if realized, with an average yield of 175.0 bushels per acre.
The U.S. weather outlook also continues to pressure soybeans, analysts said. The USDA rated 72 percent of the U.S. soybean crop as good to excellent and above market expectations.