by Agrimoney.com
Corn prices slumped to their lowest since 2011, sending wheat futures to contract lows on both side of the Atlantic, as forecasts for benign Midwest weather during the important pollination period spurred the further removal of weather premium.
Corn for December, Chicago's best-traded contract, tumbled 3.0% to $4.83 a bushel, its lowest since November 2011.
The decline dragged on wheat, which is interchangeable with corn in many purposes, which tumbled 1.4% to $6.50 ½ a bushel for September delivery, the contract's lowest ever.
In Paris, the November wheat contract dropped below E190 a tonne for the first time, hitting E189.75 a tonne.
The falls were blamed in the main on the prospect of further near-ideal weather for the US corn crop - the world's biggest, and a key source of feed grain for many importers besides domestic users - raising the prospect of the harvest setting a record this year by a margin.
'Heavier than forecasted'
Overnight, thunderstorms which developed in parts of the western Corn Belt, one area where dryness has begun to raise concerns, "were heavier than forecasted", WxRisk.com said.
Grain prices as of 11:40 Chicago time, (17:40 UK time)
Chicago corn, Dec: $4.83 a bushel, (-3.0%)
Chicago wheat, September: $6.52 ¼ a bushel, (-1.1%)
Paris wheat, November: E190.50 a tonne, (-1.0%)
London wheat, November: £164.50 a tonne, (-0.8%)
Kansas wheat: $6.98 ¾ a bushel, (-0.5%)
Rains of 1 inch or more "were common" went and north of Des Moines in Iowa, the top corn and soybean producing state, with rains of 2-4 inches east of Fort Dodge, the weather service said.
Looking ahead, while weather models have shifted rains further south heading into August, leaving most of the Midwest and upper Plains with dry outlooks, "temperatures are very likely to remain below normal", a boost to corn during the spreading pollination process, which is heat sensitive.
The proportion of US corn which has reached the pollination phase reached 43% as of Sunday, up 27 points week on week, if behind the 56% average by then, with the delay a reflection of the slow sowing period, US Department of Agriculture data overnight showed.
'Bulls are getting hit'
"Investors were not phased by coast-to-cast heat last week. They have certainly not been worried by the latest forecasts," Jerry Gidel, chief feed grains analyst at Chicago-based broker Rice Dairy, told Agrimoney.com.
"Bulls are getting hit."
US Commodities said: "The heat ridge continues to stay in the South West which is negative for prices."
In fact, the USDA data overnight did show a drop of three points week on week in the proportion of US corn rated good or excellent, thanks to the heat, although, at 63%, the figure remained far higher than the 26% last year.
Indeed, when converted into a full crop condition index, the USDA data came in with a figure of 366, "near the normal reading of 365", Mark Welch, at Texas A&M University, said.
'Accelerated moisture losses'
It is in Europe that fears are growing over hot and dry conditions, with MDA warning on Monday that "limited" rains have "allowed dryness to expand a bit across the UK, south eastern and north western France, central and southern Germany, northern Italy, Hungary, and Former Yugoslavia.
"Heat in western areas has also accelerated moisture losses," a factor "increasing stress on summer crop growth".
At broker FCStone, Jaime Nolan Miralles said: "A rise in temperatures seen across Europe and in particular Central Europe is set to continue into this week, raising concerns for yield potential in corn."
However, for wheat, the conditions are seen speeding the harvest, further pressing on prices.
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