U.S. corn slides on better weather, retreating oil

SEOUL (Reuters) - U.S. corn futures fell more than 3 percent in early Asian trading on Monday on expectations of better weather conditions and as oil prices fell back from record highs.

NYMEX crude for August delivery was trading at $144.24 a barrel, below an all-time high of $145.85 hit on Thursday, reducing appetite for biofuel feedstocks such as corn and soybean.

"Expectations for better weather conditions and retreating water levels as well as softer oil prices are all taking some steam out of grains," said a trader at KEB Futures.

Recent worries of tight grain supply following devastating flooding has left CBOT traders highly sensitive to any perceived threat in weather forecasts for the current crop, which is already developing behind schedule.

Near-term weather forecasts for the U.S. Midwest were favorable, calling for mostly clear skies and no stressful heat.

The Mississippi River, the main channel for grain flowing from the Midwest to U.S. export terminals, reopened to water navigation on Saturday after much of it was closed for nearly a month due to the worst flooding in 15 years, as water levels dropped.

Front month July corn dropped 3.4 percent to $7.20-½ a bushel after a long holiday weekend. U.S. markets were closed on Friday for the Independence Day holiday.

Corn futures shot up to a record high of above $8 last month as heavy rains swamped much of the core corn and soybean belt in the United States, the world's largest corn exporter, wiping out millions of acres of the grains and raising supply worries.

Soybean futures also fell 1.3 percent to $16.36-½ a bushel.