August 25, 2014 / 10:34 AM / 3 years ago

GRAINS-Corn, soybeans slide on outlook for record crops

* Corn retreats on forecast of record crop
    * New-crop soybeans hit contract low, wheat falls

 (Adds closing prices, broker's comment, crop condition poll)
    By Rod Nickel and Julie Ingwersen
    Aug 25 (Reuters) - Chicago corn futures fell on Monday after
two straight days of gains while soybeans slid to a contract low
on forecasts of record crops in the United States.
    Wheat also weakened on profit-taking as the focus returned
to large global crops.
    Chicago Board of Trade new-crop December corn fell 1.1
percent or 4 cents to $3.67-1/2 a bushel.
    "That's a reflection of the crop and the weather," said
Terry Linn of the Linn Group, a Chicago brokerage. "The rains
over the weekend were substantial and fell in all the right
places, and they are very bearish."
    The fact funds hold long positions in corn as the crop
rounds into shape has also led to some selling, said Karl
Setzer, market analyst at MaxYield Cooperative in West Bend,
Iowa. 
    New-crop November soybeans dropped 1.2 percent or
12-3/4 cents to $10.29-1/4 a bushel after hitting a contract low
earlier in the session. December wheat fell 1.4 percent or
7-3/4 cents to $5.54-1/2 a bushel.
    "We see lower prices for corn, soybeans and even wheat
largely driven by fundamentals," said Phin Ziebell, agribusiness
economist at the National Australia Bank. 
    Traders awaited the U.S. Agriculture Department's (USDA)
weekly crop condition ratings at 3 p.m. CDT (2000 GMT). A
Reuters poll showed the industry expected corn and soybean
ratings to be unchanged from a week earlier. 
    Farm advisory service Pro Farmer on Friday forecast the U.S.
2014 corn crop at a record 14.093 billion bushels after
completing its crop tour of U.S. grain belts. 
    USDA last week estimated the crop at a record high of 14.032
billion bushels.
    The Pro Farmer tour results fuelled expectations among
analysts that the USDA will soon raise its U.S. corn yield
forecast.
    Corn and soybeans typically come under selling pressure
around this time of year when traders determine the crop's size,
Setzer said.
    "A lot of guys are (thinking) the crop is made, which isn't
100 percent accurate," he said. "There is still some time for
yield loss. But yields are projected so high, especially in
corn, that even if we take off a bushel or two, it really
wouldn't affect the balance sheets all that much." 
    Pro Farmer forecast U.S. soybean production at 3.812 billion
bushels, with an average yield of 45.35 bushels per acre. Last
week, the USDA put the crop at an all-time high of 3.816 billion
bushels, with a yield of 45.4 bushels per acre.
    Nearby September soybeans gave up earlier gains, which
were due to dwindling supplies of last year's crop, and plunged
3.5 percent.
    "Obviously it's a very volatile contract," Linn said. "We
could just as easily be right back up tomorrow."
    The market focus for wheat on Monday was moving from the
conflict between Russia and Ukraine to the ample global wheat
supply outlook, analysts said.
    The market eyed, however, wet weather in the U.S. northern
Plains that has threatened the quality of the spring wheat crop.
        
 Prices at 2:04 p.m. CDT (1904 GMT)                 
 
                              LAST      NET    PCT  
 
                                        CHG    CHG  
 
 CBOT corn                  360.00    -5.50  -1.5%  
 CBOT soy                  1125.75   -40.25  -3.5%  
 CBOT meal                  406.10   -27.20  -6.3%  
 CBOT soyoil                 32.74     0.38   1.2%  
 CBOT wheat                 543.00    -9.00  -1.6%  
 
 (Reporting by Rod Nickel in Winnipeg, Manitoba; and Julie
Ingwersen in Chicago; Additional reporting by Michael Hogan in
Hamburg, Naveen Thukral in Singapore; Editing by Marguerita Choy
and Lisa Shumaker)

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