By Sam Nelson
CHICAGO, Dec 30 (Reuters) – U.S. soybean and corn futures markets wee down a few cents on Monday morning with corn dropping to its lowest level in two weeks as rains fell in key crop areas of major exporter Argentina, easing dought-stress on each crop.
Crop-friendly rain fell over much of Argentina’s corn and soybean growing region over the weekend and more rain is expected in roughly the northern two-thirds of the country, said John Dee, meteorologist for Global Weather Monitoring.
“There was rain over the weekend of from 0.50 inch to 1.50 inches (1.3-3.8 cm) in the north and under 0.50 inch in the south,” he said.
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It remained rather dry in the La Pampa and Buenos Aires growing region but other areas of Argentina received welcome showers, according to Dee.
Dry weather is expected to return at the end of the week, he said. “Rains continue to fall in nearly all areas of Brazil,” Dee said.
Wheat slipped under pressure from the weakness in corn and on persistent pressure from the abundant global stockpile of wheat, analysts said.
“Soybeans and corn are being weakened by forecasts of more rain in Argentina, wheat is drifting down in quiet holiday-season trade,” said Arnaud Saulais of Starsupply Commodity Brokers.
“There had been concern about dry weather damaging soybean and corn crops in Argentina. With forecasts of more rain in Argentina, this concern will be reduced.”
Argentina, the world’s third-largest exporter of corn and soybeans, has been suffering prolonged hot, dry weather that traders fear could damage crops and has supported global prices. Weekend rain and forecasts of more wet weather have improved the country’s crop outlook.
“Soybeans and corn both rallied on Friday and with the rains in Argentina coming at an important time for crop development, the market has corrected fractionally lower,” Garry Booth of brokerage ICAP said.
Argentina’s Rosario grain exchange on Monday said Argentina will harvest 55.0 million tonnes of 2013-14 soy and 22.0 million tonnes of corn.
The U.S. Department of Agriculture forecasts Argentina will harvest 54.5 million tonnes of soybeans in the new 2013-14 crop, up from 49.3 million in the previous season. The Argentine corn crop is seen little changed at 26 million tonnes.
“We could see more pressure on the market this week, although this is more likely to hit soybeans than corn,” Saulais said.
“Corn is already at a relatively low level and there is also some support still coming from the surprisingly good U.S. corn export figures announced on Friday.”
Corn and soybeans rallied on Friday following the release of the USDA’s latest export sales figures, which showed better-than-expected weekly sales.
The USDA pegged net sales of corn for the 2013-14 marketing year at nearly 1.5 million tonnes, far exceeding trade estimates, while soybean exports of more than 720,000 tonnes also topped expectations.
Corn remained under background weakness from concern China is rejecting imports that contain a genetically modified corn strain not yet approved by Chinese authorities.
