* Corn planting slowest in 29 yrs but drier weather ahead
* Wheat supported by poor U.S. crop
* Dry conditions in Black Sea, Australia support wheat
* Tight stocks, firm cash, slow farmer selling lifts soy
(Updates to include close of U.S. trading session)
By Sam Nelson
CHICAGO, May 7 Chicago Board of Trade corn
futures turned higher on Tuesday in a recovery bounce after
their biggest plunge in five weeks on Monday as U.S. farmers
struggle to plant corn in muddy fields.
The pace of corn planting is the slowest pace in 29 years, a
bullish market factor since it could result in lower yields.
However, forecasts for better planting weather for next week was
a bearish market factor.
"Weather forecasts look like farmers will get a couple bonus
days of planting, they are getting some work done now so there
is some progress," said Shawn McCambridge, analyst for Jefferies
Wheat futures also rose after being dragged lower by corn on
Monday and on declining conditions of the U.S. crop. Also,
harvest risks emerged in Australia and the Black Sea region due
to dry weather.
Soybean futures turned up on hesitant selling amid tight
stocks of U.S. soy, firm cash markets and slow farmer selling.
Traders said the market focus was on corn because of the
historically slow start to plantings.
Stalled by rain and late-season snow last week, U.S. farmers
have planted just 12 percent of their intended corn acres, the
slowest pace since 1984, the U.S. Department of Agriculture said
in a weekly report.
"It looks virtually impossible for farmers to catch up the
delay entirely by mid-May, when the window for corn planting
closes. We therefore view yesterday's price slide as
exaggerated," Commerzbank analysts said in a note.
Chicago Board of Trade July corn was up 3-1/2 cents
per bushel at $6.40, July soybeans were up 13 at
$13.82-1/4 and wheat for July delivery was up 6-1/4 cents
Corn prices have been buffeted in recent months by
expectations of bumper crops in South America and the United
States this year and by concerns about tight old-crop supplies
due to the drought-hit 2012 U.S. harvest.
"We still have significant issues in the United States and
those issues were reaffirmed last night in the weekly crop
progress report," said Luke Mathews, commodities strategist at
the Commonwealth Bank of Australia.
"It is unlikely we are going to make up for the deficit in
any significant fashion over the next couple of weeks which
means there is a risk of lower area planted and in addition some
possible yield penalties."
Better corn planting weather is seen for the next week to 10
days in the U.S. Midwest but conditions will be less than ideal
with widespread rains expected beginning Wednesday and continue
into the weekend, an agricultural meteorologist said.
"The best window is the next day or two, then they will have
to wait until next week...not the best of conditions but not a
disaster either," said John Dee, meteorologist for Global
WHEAT WEATHER GAINS ATTENTION
The USDA said 32 percent of the U.S. winter wheat crop was
rated in good to excellent condition, down from 33 percent a
week earlier and the lowest since 1996. The poorest ratings
remained in the Plains states, which have struggled with drought
as well as spring freeze damage.
Seedings of spring wheat, most of which is high-quality
milling wheat produced in the northern Plains, continued to lag
due to cold and wet conditions.
In North Dakota, the top U.S. spring wheat state, spring
wheat planting was 7 percent complete, up from 2 percent a week
earlier but far behind the five-year average of 40 percent.
Additional support for wheat was dry weather continuing to
delay planting in Australia's eastern grain belt, although
output in the key western wheat region was set to rebound after
Dryness was a concern for crops in major Black Sea exporters
Russia and Ukraine, which are recovering from drought last year
than slashed harvest volumes.
In Ukraine, yields of spring barley and spring wheat may
drop as much as 30 percent if no rain falls on dry fields in the
next two weeks, a senior weather forecaster said on Tuesday.
In neighbouring Russia, concern was centered on the south
where continued dry weather could hurt yields in the country's
main wheat export region.
"I'm more focused on the problem of water stress in Russia
than on the corn planting delays in the United States because
the U.S. farmers will get their planting done in the end,"
Michel Portier, head of French consultancy Agritel, said.
Prices at 1:34 p.m. CDT (1834 GMT)
LAST NET PCT YTD
CHG CHG CHG
CBOT corn 676.50 -2.25 -0.3% 4.6%
CBOT soy 1463.50 19.00 1.3% 22.1%
CBOT meal 416.30 3.20 0.8% 34.6%
CBOT soyoil 49.09 0.40 0.8% -5.8%
CBOT wheat 699.50 6.50 0.9% 7.2%
CBOT rice 1525.00 -6.50 -0.4% 4.4%
EU wheat 245.50 -0.25 -0.1% 21.2%
US crude 95.61 -0.55 -0.6% -3.3%
Dow Jones 15,040 71 0.5% 23.1%
Gold 1451.00 -17.89 -1.2% -7.2%
Euro/dollar 1.3084 0.001 0.1% 1.1%
Dollar Index 82.2770 -0.0380 -0.1% 2.6%
Baltic Freight 889 11 1.3% -48.8%
(Additional reporting by Valerie Parent and Gus Trompiz in
Paris, Naveen Thukral in Singapore; Editing by Bob Burgdorfer)