Grain futures lower; Corn extends slump as U.S. crop fears ease

Investing.com - U.S. grain futures were lower on Monday, with corn prices coming under heavy selling pressure amid reduced concerns over U.S. crop prospects.

Market players continued to monitor weather conditions across grain-growing regions in the U.S. Midwest and in the Great Plains.

On the Chicago Mercantile Exchange, corn futures for September delivery traded at USD5.3788 a bushel, down 1.2% on the day.

The September contract fell by as much as 1.35% earlier in the day to hit a session low of USD5.3713 a bushel, the weakest level since July 9.

The U.S. Department of Agriculture said last week that U.S. stockpiles before the 2014 harvest will total 1.959 billion bushels, up 0.5% from its month-earlier prediction of 1.949 billion bushels.

Market analysts expected the USDA to cut its corn outlook by 3.5% to 1.874 billion bushels.

The agency also said that this fall's U.S. corn harvest will total 13.95 billion bushels, an all-time high.

Meanwhile, wheat for September delivery traded at USD6.7013 a bushel, down 1.5% on the day. The September contract fell by as much as 1.7% earlier in the session to hit a daily low of USD6.6850 a bushel.

Wheat prices tracked corn futures lower. Wheat and corn prices are linked because both can be used as animal feed.

The USDA said last week that U.S. wheat reserves at the end of the crop's current marketing year on May 31 will total 576 million bushels, down from 659 million bushels estimated last month.

Market analysts expected the USDA to cut its wheat forecast to 624 million bushels.

The agency said it expected U.S. wheat exports to be 100 million bushels higher in the current crop year than it previously forecast, citing “strong sales, particularly to China."

Elsewhere on the CBOT, soybeans futures for August delivery traded at USD14.2800 a bushel, little changed on the day.

The August contract held in a range between USD14.1975 a bushel, the daily low and a session high of USD14.3188 a bushel.

Last week, the USDA raised its forecast for domestic soybean stocks as of August 31 to 295 million bushels, up 11% from the 265 million bushels estimated a month ago.

Analysts had projected 270 million bushels.

The report also showed that global supplies of the oilseed will total 74.12 million tons, a record high.

Corn is the biggest U.S. crop, followed by soybeans, government figures show. Wheat was fourth, behind hay.