BLBG:Corn Gains Before USDA Report That May Cut Crop Outlook
Corn rallied before a U.S. government report that’s expected to show a cut in the forecast for this year’s U.S. crop after drought across the Midwest hurt yields in the world’s biggest grower. Soybeans climbed.
December-delivery corn increased as much as 1 percent to $7.2475 a bushel on the Chicago Board of Trade and was at $7.2425 at 10:04 a.m. in Singapore. The most-active price gained to $7.33 a bushel on July 9, the highest level since September, as heat baked U.S. fields.
The U.S. Department of Agriculture will probably cut its estimate for U.S. corn output to 13.534 billion bushels this season, from its June outlook for a record 14.79 billion, according to the average of analysts’ estimates in a Bloomberg survey. Last year’s crop totaled 12.358 billion bushels. The report is due for release at 8:30 a.m. in Washington.
“The USDA has no choice but to cut its yield estimate of 166 bushels an acre,” Morgan Stanley analysts led by Hussein Allidina wrote in a report dated yesterday, reiterating a bullish view on corn. “Adverse weather continues to hammer plant conditions.”
Soybeans for November delivery gained as much as 1.2 percent to $15.575 a bushel, before trading at $15.5525. The most-active price reached $15.7175 on July 9, the highest level since the global food crisis in 2008. Wheat for September delivery climbed 0.4 percent to $8.245 a bushel, after trading at the highest level since April 2011 on July 9.
To contact the reporter on this story: Luzi Ann Javier in Singapore at ljavier@bloomberg.net
To contact the editor responsible for this story: James Poole at jpoole4@bloomberg.net
