Corn plunges most in 3 years after higher U.S. crop estimate surprises
* Five corn contracts hit daily trading limit down
* USDA boosts corn crop forecast, lowers soy
(Adds closing prices, changes analyst quotes)
By Barbara Smith
CHICAGO, Aug 12 (Reuters) - Chicago corn futures fell nearly
6% on Monday, their biggest drop in more than three years, after
the U.S. Department of Agriculture forecast a
The USDA forecast the 2019/20 corn crop at 13.901 billion
bushels, above the 13.875 billion bushels expected in July. A
Reuters poll of analysts had predicted a USDA forecast of 13.193
The USDA resurveyed farmers following wide criticism of a
June report on how many acres of corn would be planted. Its new
survey showed farmers had planted 90.0 million acres, well above
the 80.05 million acres in the June poll.
"Traders didn't get to see corn acres cut as much as they
wanted so they're sending futures markets sharply lower," said
Terry Reilly, senior commodity analyst, Futures International.
"The crop isn't as bad as people predicted out there."
Chicago Board of Trade most-active corn closed at to
$3.92-3/4 cents. Five corn futures contracts fell to their daily
limit down of 25 cents, the second time in seven weeks.
Soybeans settled down 12-1/2 cents, or 1.5% to
$8.70-1/4 a bushel, while wheat closed down 27-3/4 cents.
or 5.4% to $4.71-3/4 a bushel.
"These numbers could not have been worse for the corn, and
the corn is the locomotive that pulls the grain train," said
Charlie Sernatinger, analyst with ED&F Man Capital.
Wheat markets are also facing good world supplies and heavy
Wheat harvesting in Europe is generally progressing well,
with work in France almost finished.
USDA lowered its soybean crop estimate to 3.680 billion
bushels from 3.845 billion bushels previously.
While rain disrupted corn planting this year, dry weather in
recent weeks has caused concern about lack of water hindering
Some analysts said USDA's corn numbers were still suspect,
particularly the projected yield of 169.5 bushels per acre.
"The USDA is telling us this average, and you have to trade
with the numbers you're given, but let's be realistic, these
numbers are off," said J. Mark Kinoff, president of Ceres Hedge.
The USDA also released their weekly crop report. Corn and
soybeans saw no change in their good-to-excellent rating, at 57%
and 54%, respectively. Spring wheat experienced a significant
drop, with the good-to-excellent rating being 69%, down from 73%
a week earlier.
(Reporting by Barbara Smith; Additional reporting by Julie
Ingwersen, Tom Polansek and Karl Plume in Chicago and Michael
Hogan in Hamburg; Writing by Caroline Stauffer; Editing by Steve
Orlofsky and Sandra Maler)
First Published: 2019-08-12 02:51:32
Updated 2019-08-12 23:39:49
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