PARIS/SINGAPORE: Chicago corn, wheat and soybean futures fell on Wednesday, retreating from eight-year highs struck a day earlier as the market assessed the extent of weather risks that had fanned the recent run-up in prices.
Analysts said there was profit-taking after strong investment fund flows into grains, encouraged by signs of improving crop weather in the US Midwest.
"There is a realisation that there is plenty of time to grow crops in the United States," said Ole Houe, director of advisory services at brokerage IKON Commodities in Sydney.
"The current supply and demand situation does not warrant $7-bushel corn. The last 100 cents are speculators driving the market."
The chief executive of agribusiness group Archer Daniels Midland Co said on Tuesday he expects US corn and soybean plantings to rise by about 5 million acres combined versus a government forecast.
The most-active corn contract on the Chicago Board of Trade (CBOT) was down 1.3% at $6.45-3/4 a bushel by 1126 GMT, after hitting an eight-year top at $6.84 on Tuesday.
Corn, wheat and soybeans had already ended lower on Tuesday as the rally lost momentum following the intraday peaks.
Commodity funds were net sellers of CBOT soybeans, soymeal, wheat and corn futures contracts on Tuesday and net even for soyoil futures contracts, traders said.
Corn has been at the centre of the grain rally. Cold planting weather in the United States and dry growing conditions in southern Brazil have cast doubts over harvest prospects in the world's top exporters at a time of tight supplies.
Southern Brazil is forecast to stay dry into early May, but an expected warming of temperatures along with showers in the US Midwest could help planting and early crop development.
CBOT wheat dropped 1.9% to $7.18-3/4 a bushel, while soybeans were down 1.0% at $15.05 a bushel.
Tuesday's cancellation of a wheat import tender by Egypt was seen by traders as a sign that high prices were discouraging buyers.
In soybeans, US-based meat processor Perdue is shipping one cargo of 31,450 tonnes of Brazilian supplies into the United States, according to shipping data, as US stocks dwindle.