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GRAINS-Corn hits two-month low on improved U.S. crop situation – Agricultural Commodities

* Corn trades decrease, soybeans observe

* Commerce talks with China are slowing down (Provides closing costs)

By Barbara Smith

CHICAGO, July 30 (Reuters) – Chicago corn futures reached a two-month low on Tuesday after a weekly U.S. Division of Agriculture (USDA) report on Monday mentioned the U.S. crop was in higher situation than analysts anticipated.

The Chicago Board of Commerce’s (CBOT) most-active corn contract settled down 6 cents, or 1.5%, at $4.21 a bushel. Wheat settled down 6-1/Four cents, or 1.4%, at $4.97-1/Four a bushel. Soybeans settled 7-1/2 cents, or 1.1% decrease, at $8.96-3/Four a bushel and hit a one-month low.

The USDA crop progress report mentioned 58% of U.S. corn was in good to wonderful situation, up one proportion level from final week. Analysts had on common anticipated 57%.

Merchants are on edge in regards to the crop’s dimension and situation after heavy rains prompted unprecedented planting delays this spring. They’re ready for the USDA to challenge updates on how a lot corn and soy had been planted in a report subsequent month.

“I believe we’re going to hover across the 56% to 58% vary within the good-to-excellent for crops till the August 12 acreage report,” mentioned Jim Gerlach, president of A/C Buying and selling.

Gerlach added progress numbers will seemingly be extra correct as soon as the acreage report comes out. The USDA’s ranking for U.S. soybeans was unchanged on the week at 54% good to wonderful. Analysts had additionally estimated 54%.

Extra rain is predicted within the U.S. Midwest within the coming days, however analysts are nonetheless unsure if the showers will profit crops.

“It’s nearly just like the corn had an arm amputated,” mentioned Gerlach. “It’s going to take much more than some rain to repair this drawback.”

Merchants are additionally watching the brand new spherical of U.S.-China talks this week to settle the commerce struggle that has slashed U.S. soybean exports to China. However sellers had been cautious about possibilities of a breakthrough.

“I believe we’re beginning to get a wake-up name in terms of these commerce talks with China,” mentioned Gerlach. “Trump has mentioned some issues that haven’t been very hopeful.”

Trump on Tuesday warned China towards ready out his first time period to finalize any commerce deal, saying if he wins re-election within the November 2020 U.S. presidential contest, the end result might be no settlement or a worse one.

Trump mentioned China gave the impression to be backing off on a pledge to purchase U.S. agricultural merchandise, which U.S. officers have mentioned might be a goodwill gesture and a part of any closing pact. (Reporting by Barbara Smith in Chicago Extra reporting by Michael Hogan in Hamburg, Naveen Thukral in Singapore, modifying by Louise Heavens and Tom Brown)

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