Corn Drops to Four-Year Low on Outlook for Record U.S. Supply

Aug 01, 2014 3:48 pm ET

Aug. 1 (Bloomberg) -- Corn futures fell to the lowest since July 2010 on prospects for a bumper crop in the U.S., the world’s largest producer. Soybeans dropped the most in four weeks, while wheat rose.

Corn production will rise 4.3% to a record 14.518 billion bushels, and soybean output will jump 17% this year, the Linn Group said today in a report. Widespread rain next week will reduce crop stress after below-normal precipitation in July depleted soil-moisture reserves, World Weather Inc. in Overland Park, Kansas, said in a report.

“The rain next week increases the confidence for big crops, especially for soybeans, which are more dependent on August moisture,” Jacquie Voeks, the senior market adviser for the Stewart Peterson Group in West Bend, Wisconsin, said in a telephone interview. “There’s little urgency for buyers to step up purchases now.”

Corn futures for December delivery dropped 1.3 percent to close at $3.6225 a bushel at 1:15 p.m on the Chicago Board of Trade. Earlier, the price touched $3.61, the lowest for a most- active contract since July 7, 2010. In July, the grain tumbled 14 percent, the most since September 2011.

Soybean futures for November delivery fell 2.2 percent to $10.585 a bushel, the biggest drop since June 30. The oilseed, used to make animal feed and cooking oil, fell 6.5 percent last month, touching a 45-month low of $10.55 on July 23.

Soybean-oil futures for December delivery dropped 1.9 percent to 35.71 cents a pound. The price touched 35.69 cents, the lowest since Oct. 15, 2009.

Wheat futures for September delivery rose 0.8 percent to $5.3425 a bushel. The price reached $5.44, the highest since July 18.