GRAINS-Corn drops below $4 as U.S. weather outlook improves
* CBOT corn sags as funds liquidate long positions * Soybeans follow corn; weather seen as less threatening * USDA maintains U.S. corn crop ratings, cuts soybeans * Wheat nears one-month low as U.S. harvest continues (Updates prices, adds quotes, changes byline, dateline, previous LONDON) By Julie Ingwersen CHICAGO, June 21 (Reuters) - U.S. corn futures fell below $4 a bushel on Tuesday for the first time in nearly a month as forecasts for less-threatening weather in the Midwest prompted funds to liquidate long positions, traders said. Soybeans and wheat followed corn's lead. K.C. hard red winter wheat futures <0#KW:> hit contract lows. At 11:49 a.m. CDT (1649 GMT) at the Chicago Board of Trade, the July corn contract was down 22 cents at $3.99-1/4 a bushel after falling to $3.96-3/4, its lowest since May 25. July soybeans were down 5 cents at $11.38-1/2 a bushel after dropping to $11.28-3/4, near last week's low. CBOT July soft red winter wheat was down 9-1/4 cents at $4.63-3/4 a bushel. Corn led the move, with technical selling accelerating as the new-crop December contract fell through chart support near $4.20. "It's grand-scale liquidation in the corn market due to better moisture in the forecast and cooling temperatures," said Tom Fritz, a partner with EFG Group in Chicago. "It looks like you hit some major sell-stops." Commodity funds had built up a massive net long position in CBOT corn in recent weeks as the spot contract neared a two-year high on export demand tied to tightening South American supplies and uncertainty about the U.S. growing season. But the U.S. Department of Agriculture's weekly crop progress report late on Monday rated 75 percent of the U.S. corn acreage in good to excellent condition, unchanged from the previous week, despite a hot spell in the Midwest. Analysts surveyed by Reuters had expected a decline in crop ratings. Forecasters called for much-needed rains this week, easing worries about dryness. The USDA's report showed topsoil moisture declining in big corn states, including Iowa, Illinois and Missouri. "The prediction of rain has gone some way to allaying fears of an overly dry summer," Commerzbank said in a market note. Soybean futures sagged in sympathy with corn, although the unwinding of long corn/short soybean spreads lent underlying support. The USDA rated 73 percent of the U.S. soybean crop as good to excellent, down from 74 percent a week earlier and in line with trade expectations. CBOT wheat followed the weaker trend, with the July contract falling to $4.62 a bushel, its lowest since May 24. The market faced additional seasonal pressure from the U.S. winter wheat harvest, which was 25 percent complete by Sunday, the USDA said. CBOT prices as of 11:47 p.m. CDT (1647 GMT): Net Pct Volume Name Last change change CBOT wheat Wc1 463.75 -9.25 -2.0 40856 CBOT corn Cc1 399.50 -21.75 -5.2 209685 CBOT soybeans Sc1 1137.50 -6.00 -0.5 58116 CBOT soymeal SMc1 394.20 -8.50 -2.1 31996 CBOT soyoil BOc1 31.39 -0.25 -0.8 38412 CBOT wheat, corn and soybeans shown in cents per bushel, soymeal in dollars per short ton and soyoil in cents per lb. (Additional reporting by Nigel Hunt in London and Melanie Burton in Melbourne; editing by Christian Schmollinger and David Clarke)
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