Corn Declines as Improved Crop Ratings May Boost U.S. Harvest

By Jae Hur

Sept. 1 (Bloomberg) -- Corn slumped as the U.S. Department of Agriculture predicted improved conditions may produce the country’s second-largest crop on record. Wheat also fell.

About 69 percent of the U.S corn crop was in good or excellent condition as of Aug. 30, compared with 61 percent a year earlier, the USDA said yesterday in a report.

“No doubt there will be another bumper crop for corn in the U.S.,” Hiroyuki Kikukawa, general manager of research at IDO Securities Co., said today by phone.

Corn for December delivery fell as much as 1.2 percent to $3.2575 a bushel in electronic trading on the Chicago Board of Trade and traded at $3.2625 as of 12:58 p.m. Singapore time. The most-active contract lost 5.7 percent in August, the third monthly drop.

The USDA has predicted a crop of 12.761 billion bushels, 5.5 percent more than last year and the second-largest ever.

Soybeans for November delivery were 0.5 cent lower at $9.79 a bushel after trading between $9.7375 and $9.89. The oilseed dropped 3.1 percent yesterday.

“The U.S. soybean crop, following planting delays, will be vulnerable if early frost hits,” Kikukawa said. “This may reduce crop yields.”

About 93 percent of soybean plants were setting pods and beginning to fill them with beans as of Aug. 30, compared with 85 percent a week earlier and the five-year average of 96 percent, the USDA said. Pod-setting is the most critical crop development period in determining final yields.

Midwest Cold

“While the core of the chilliest air will settle a bit farther to the south and east tonight, unseasonably cool conditions will hang over much of the Midwest through Tuesday night,” AccuWeather.com forecast yesterday. “A warmer flow behind an area of high pressure will help temperatures climb a bit more during the second half of the week.”

About 75 percent of corn plants in the top 18 producing states were filling kernels with sugars and starch as of Aug. 30, up from 57 percent a week earlier, the USDA said. The average in the previous five years was 88 percent.

An estimated 32 percent of the crop was denting, when kernels begin to advance toward maturity, down from 42 percent a year ago and the five-year average of 60 percent, the USDA said.

Wheat for December delivery in Chicago dropped 0.3 percent to $4.9725 a bushel as of 1:07 p.m. in Singapore. The price yesterday touched $4.8075, the lowest level since Dec. 8. The contract dropped 5.6 percent last month, the third consecutive decline, partly because of slack demand for U.S. inventories.

To contact the reporter on this story: Jae Hur in Singapore at jhur1@bloomberg.net