Chicago Board of Trade corn futures rose 1 percent to their highest levels in more than a week on Thursday, supported by sharply higher soybean and wheat prices and uncertainty surrounding US corn yields, traders said.
Investors also continued to exit short positions with corn prices rebounding from the contract lows reached on August 12, when the US Department of Agriculture shocked the market by boosting its forecast for corn production and yields.
The annual Pro Farmer Midwest Crop Tour wraps up field checks in seven Corn Belt states later on Thursday, with yield potential overall seen above average in the western half of the region and below average in the eastern half.
Gains in corn prices this week reflected doubt over the USDA forecast, the traders said, even as the Pro Farmer tour confirmed some of the lofty projections, at least in the western Midwest states of Iowa, Minnesota, Nebraska and South Dakota.
Still, the modest rally in corn could be running out of steam in the near term. Front-month September futures failed to surpass their session high from Wednesday and the contract also hit upside resistance at its 10-day moving average.
Open interest in corn futures as of Wednesday declined to the lowest levels since July, an indication that investors were liquidating short positions during this week's rally and not making new long or bullish bets on prices.