US corn falls over one percent; wheat down on Russian supplies

US corn slid more than 1 percent on Monday, weighed down by concerns over US and European debt, after strong gains last week on forecasts of hot weather which could threaten crop yields. Wheat also dropped 1.4 percent, falling for a third straight day as US grains face stiff competition from Russian suppliers.
"The dollar is trading higher and that seems to be playing out so far today," said Luke Mathews, commodity strategist at Commonwealth Bank of Australia. "The market still remains worried about forecasts of excessive heat in the US Midwest as the corn crop enters the critical pollination stage."
Chicago Board of Trade December corn fell 1.2 percent to $6.76-3/4 a bushel by 0320 GMT, after gaining 7.5 percent last week. September wheat was down 1.4 percent to $6.85-1/4 a bushel, while November soy contract rose 0.1 percent to $13.89 a bushel.
The dollar index, which measures the strength of the greenback against a basket of currencies, firmed 0.4 percent.
The bellwether new-crop Chicago December corn futures contract has been extremely volatile and no letup from that pattern is expected this week as the US bread basket boils while the crop tries to reproduce.
High heat forecast for this week in the US grain belt at a time when the corn crop begins to pollinate and set yields could roil the market. Traders caution the market could plunge if forecasts for cooler and wetter weather surface.
The crop could be stressed and yield potential hurt at a time when a bumper harvest is needed to build supplies and ease high global food prices and operating costs for companies using corn as feedstock.
An oppressive and potentially deadly summertime mix of sizzling temperatures and high humidity baked a large swath of the United States on Sunday, pushing afternoon heat indexes in dozens of cities to dangerous levels.
Forecasters warned the heatwave would persist through much of the coming week and cautioned residents in more than three dozen states to take extra precautions.
Soybeans, which are also widely grown in the Midwest, are still a couple of weeks from their critical pod-developing stage, but the forecast for little precipitation in July is supportive for the market.