By Benjamin Parkin
CHICAGO -- Corn futures fell Monday as traders bet recent weather would aid the U.S. crop.
Analysts expect the U.S. Department of Agriculture to show an improvement in corn conditions in its weekly crop report Monday afternoon, with rain and cooler temperatures in the Midwest aiding soil moisture. Traders wager better growing conditions will likely limit the impact of erratic weather so far this season, contributing to large global supplies and depressing prices.
Corn prices also took a hit as the Commodity Futures Trading Commission said Friday hedge funds had sharply peeled back bets corn prices would fall. Money managers cut bearish bets by 87% to come to a net short position of 17,929 futures and options as of Tuesday.
That underwhelmed traders who expected to see a steep rally as speculators pulled out of those pessimistic bets.
Corn futures for July delivery fell 2.3% to $3.75 1/4 a bushel at the Chicago Board of Trade, brushing off a recent weather-risk premium to fall back into a trading band established in late May and early June.
Moves in soybean and wheat markets were muted as traders waited for the USDA crop ratings. A higher dollar and lower crude-oil prices limited gains.
CBOT July wheat futures climbed 0.4% to $4.67 a bushel, inching toward a year high, while soybeans slid 0.1% to $9.37 3/4.
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