Corn and soybeans slip on rain relief, wheat retreats further

PARIS/SYDNEY: US corn and soybean futures fell by about 2 percent on Monday as forecasts for rain and less intense heat curbed fears of production losses in the US Midwest.

Chicago wheat dropped to its lowest in almost a month as wheat markets continued to retreat from recent highs, with weather damage to US spring wheat seen priced in for now.

After some showers last week, rain is expected across much of the US Midwest this week, while summer heat is expected to ease next week.

"Dry weather has been the big concern and so this (rain) event will ease some fears," said Phin Ziebell, agribusiness economist at National Australia Bank.

Grain markets are awaiting the US Department of Agriculture's (USDA) weekly crop ratings, published after the close of US trading on Monday, for the latest indication of the weather impact, after a slight decline in ratings last week.

The most active corn futures on the Chicago Board of Trade were down 2 percent at $3.85-1/2 a bushel at 1233 GMT, having touched their lowest since July 17 at $3.84-3/4 a bushel.

Corn closed 2.8 percent down in the previous session.

The most active soybean futures were down 1.9 percent at $10.03-1/4 a bushel, having closed 0.5 percent down on Friday.

"Weather models are under scrutiny, especially by the funds who tried to realise some profit-taking on corn and soybean last Friday," consultancy Agritel said in a note.

The most active wheat futures were down 1.5 percent at $4.91-3/4 a bushel. That was near the session low of $4.91, the weakest since June 29.

Wheat prices have eased in recent days despite limited respite for spring wheat in the northern U.S Plains after drought and sweltering heat this year.

With spring wheat harvesting getting under way, weather damage was seen as already done, with supply pressure coming from advancing harvests of winter wheat in the United States and Europe.

In France, the European Union's biggest wheat producer, farmers had harvested 63 percent of the soft wheat crop by July 17, farming agency FranceAgriMer said on Friday.