Wheat drops 2pc for sixth day of declines

CHICAGO: US wheat futures dropped 2 percent on Monday falling for the sixth straight day to a 6-1/2 month low on advancing harvest of the US crop and improved crop weather in Europe.

Corn also fell for the sixth consecutive trading session on better growing weather in the US and on fund liquidation tied to concerns about the global economy amid a mounting crises surrounding Greece's debt issue.

"We're in the throes of wheat harvest, that's weighing on wheat and for corn the weather is improving, the corn crop is looking very good," said Dan Cekander, an analyst for Newedge USA.

Soybean futures turned higher as short sellers covered their positions following a fall of soy late last week to a one month low.

At 9:50 a.m. CDT (1450 GMT), CBOT July wheat was down 10 cents per bushel at $6.62-1/4 per bushel, July corn was down 1-3/4 at $6.98-1/2 and July soy was up 5 at $13.38.

Crude oil and other commodity markets fell on Monday as investors lost their appetite for risk after European finance ministers postponed an emergency loan to help Greece avoid defaulting on its debt.

"An environment of a firmer dollar, resurfaced macro-economic concerns and broad-based risk aversion, coupled with recent rain in Europe and more crop supportive weather in the US Midwest, is dampening prices and sentiment," Sudakshina Unnikrishnan of Barclays Capital said in a market note.

Although grain markets were under pressure from more favorable weather worries about the global economy also continued to hamper buying interest.

"We've seen fund liquidation on worries that the Greek debt crisis could spread and further weaken economic growth," said Gary Booth a senior advisor at MF Global in Sydney.

"This week we may see some stability but downward pressure still exists," said Booth.

Copyright Reuters, 2011