Corn at 3-week high on US area outlook, May soy hits 8-month low

CHICAGO: US corn futures hit a three-week high on Monday while soybeans set multi-month lows as traders continued to respond to a plantings forecast released Friday by the US Department of Agriculture, analysts said.

Wheat followed corn higher, supported by commodity funds covering short positions.

"We're still buying feed grains and selling oilseeds, coming off Friday's reports. Most of the buying in corn and wheat is short covering while we're still liquidating in beans a little bit," said Tom Fritz, a partner with EFG Group in Chicago.

Chicago Board of Trade May corn settled up 3-1/2 cents at $3.67-3/4 per bushel after reaching $3.71-3/4, its highest since March 9. March soybeans ended down 7-3/4 cents at $9.38-1/4 a bushel after dipping to $9.37-1/4, the contract's lowest since Aug. 2.

CBOT May wheat finished up 1-1/4 cents at $4.27-3/4 a bushel.

Corn was supported by the USDA's projection on Friday that US farmers would plant 89.996 million acres of corn. The figure fell below a range of trade expectations.

The USDA forecast US soybean plantings at 89.482 million acres, above trade expectations.

"You've got corn trying to maybe buy some acres back," said Terry Linn, analyst with Linn & Associates.

Corn drew light support from concerns about a slow start to planting following heavy weekend rains in the Mississippi River Delta.

Analysts also noted fund-driven buying at the start of a new month and quarter, along with short-covering. The US Commodity Futures Trading Commission's weekly commitments report on Friday showed that managed funds expanded their net short position in CBOT corn futures to the widest since October, leaving the market open to short-covering rallies.

Along with the USDA's big plantings forecast, soybeans were pressured by the ongoing harvest of a massive South American soy crop and chart-based selling as the May contract fell below Friday's low of $9.44-1/4.

CBOT wheat firmed on technical buying, but K.C. hard red winter wheat futures turned lower toward the close, reflecting improving yield prospects for the hard red winter wheat crop following beneficial rains last week in the southern US Plains.

After the close, the USDA rated 51 percent of the US winter wheat crop as good to excellent, compared with 59 percent a year earlier.

But USDA's state reports showed week-on-week improvements in crop ratings for several key winter wheat states, including Kansas, Texas, Oklahoma and Colorado.