Corn Prices Tumble as Forecasts Call for Bountiful Harvest

U.S. corn fell Monday amid prospects for a bountiful harvest in the United States while soybeans recovered from early losses on exporter buying.

Investors kept an eye on the beleaguered housing sector, where inventories of unsold single-family homes rose to the highest level in more than 15 years in July, weighing on the stock market and raising concerns in commodities such as gold.

Grain barge traffic on a 60-mile stretch of the Illinois River was halted following nearly a week of storms blamed for 14 deaths in the Midwest, but markets were not affected.

Chicago Board of Trade corn futures fell at the opening bell, in line with losses in overnight electronic trading, amid prospects of a record crop this year.

"Corn is lower because of Pro Farmer," said grains analyst Charlie Sernatinger of Fortis Clearing Americas.

Industry newsletter Pro Farmer Friday estimated the 2007 U.S. corn crop at 13.109 billion bushels, with an average yield of 153.47 bushels per acre. The tally topped the Agriculture Department's August forecast of a record 13.054 billion.

Pro Farmer's estimate came after crop scouts toured the seven top corn and soy producing states in the United States to assess the crops' yield and production potential.

Farmers are expected to have planted the most corn acres this spring since 1944 as prices surged to 10-year highs in February amid strong demand from the ethanol industry.

September corn fell 6-1/4 cents to $3.35-1/4.

November soybeans were up 1/2 cent at $8.65-1/2 while CBOT December wheat was down 1 cent at $7.41 a bushel. CBOT soybeans fell in tandem with corn at the opening bell, but pared losses by mid-morning amid exporter buying.

"There's a lot of exporter pricing," Sernatinger said, adding that it seemed like sizable soybean sales were made to North African countries ahead of the Muslim fasting month of Ramadan, which is likely to begin Sept. 13.

Traders said CBOT soybeans were supported by buy stops, or preset orders to purchase at specific price levels.

Pro Farmer estimated the U.S. soybean crop at 2.658 billion bushels, with an average yield of 42.0 bushels per acre. That estimate was above the USDA's August estimate of a 2.625 billion bushels, with an average yield of 41.5 bpa.

CBOT wheat futures were mixed in choppy trade, weighed by the declines in corn.

Traders said the 100,000 tons of wheat Iraq bought at its tender of Aug. 4 was likely to be sourced from Canada. The market remained underpinned by tight global supplies, which helped futures hit 11-year highs last week.