HAMBURG: Chicago corn and soybean futures fell on Tuesday after the U.S. Department of Agriculture (USDA) gave a positive view of U.S. crop conditions while welcome rain and cooler weather were also forecast in U.S. grain belts.
Wheat followed corn lower.
Most-active corn on the Chicago Board of Trade was down 0.9% at $4.42-3/4 a bushel at 1036 GMT. Corn fell almost 3% on Monday after hitting five-year highs.
Soybeans lost 0.6% to $9.14-1/4 a bushel and wheat dropped by 0.7% to $5.04 a bushel.
"Corn and soybeans are being weakened by the positive picture of crop conditions given by the USDA when there had been some expectations of a decrease in conditions," said Matt Ammermann, commodity risk manager with INTL FCStone.
"Weather forecasts for U.S. grain belts are also for cooler temperatures and with some rain, which is welcome. This now just has to be realised."
Rain from the remains of former Tropical Storm Barry is edging into some U.S. grain regions after recent warm, dry weather fuelled worries that corn could be stressed.
"Over the weekend there was concern about hot weather for U.S. corn regions but forecasts have now flipped and are for not so hot and with some rain," Ammermann said.
"There is relief in the market about this. Continued rains are required by U.S. corn, which is in a delicate state given the late plantings this year."
The USDA said in its weekly crop report that 58% of U.S. corn was in good-to-excellent condition, up from 57% last week and above market expectations of 56%.
The USDA said 54% of the U.S. soybean crop was in good-to-excellent condition, up from 53% last week and ahead of market forecasts of 53%.
The USDA's wheat assessment was not so positive.
Some 57% of the U.S. winter wheat harvest is complete, up from 47% last week but below expectations of 62%, the USDA said.
The USDA said 76% of the U.S. spring wheat crop was in good-to-excellent condition, behind market expectations of 78%.
Wheat is following corn closely, Ammermann said.
"The USDA winter wheat harvest progress and spring wheat conditions were below expectations but not enough to cause concern," he said.
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