Corn for delivery after the harvest jumped to a nine-month high on speculation that hot, dry weather in the next two weeks will reduce yields in the U.S., the world’s largest grower. Soybeans fell.
Temperatures as much as 10 degrees Fahrenheit above normal and dryness over the next three days will increase stress on Midwest crops that got less than 25 percent of normal rain since May 1, John Dee, the president of Global Weather Monitoring in Mohawk, Michigan, said in a telephone interview. The weather will be mostly dry in the first week of July, damaging corn plants that will be pollinating, he said.
“This is a drought that has caught people by surprise, and that’s why prices are running to the upside,” Chad Henderson, a market analyst at Prime Agricultural Consultants Inc. in Brookfield, Wisconsin, said in a telephone interview. “The crops are declining, and there’s not enough rain in the forecast to prevent irreversible corn damage. Soybeans still have time to recover.”
Corn futures for December delivery gained 5.1 percent to close at $6.24 a bushel at 2 p.m. on the Chicago Board of Trade. Earlier, the price touched $6.2475, the highest for the contract since Sept. 21. Yesterday, the commodity surged by the exchange limit of 40 cents, or 7.2 percent, the most since June 30, 2010.
Soybeans futures for November delivery fell 0.9 percent to $14.1325 a bushel on the CBOT. The most-active contract jumped 3.6 percent yesterday.
About 70 percent of Illinois, the biggest U.S. corn and soybean grower behind Iowa, is in moderate to extreme drought, National Weather Service data show.
Fifty-six percent of the U.S. corn crop was in good or excellent condition as of June 24, down from 63 percent a week earlier, the biggest decline since June 2007, U.S. Department of Agriculture data showed yesterday.
Corn is the biggest U.S. crop, valued at $76.5 billion in 2011, followed by soybeans at $35.8 billion, government figures show.
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