July 8 (Reuters) – The withering U.S. corn crop is gaining
some respite from a record heat wave this week but new weather
forecasts on Sunday offered scant signs of the rainfall it
urgently needs to avoid the worst drought damage in nearly a
quarter century.
As the majority of a near-record-size U.S. corn area is now
set to enter the key phase of pollination, a period when hot and
dry conditions can cause irrevocable damage, the lack of
moisture threatens to extend a rally that has already propelled
corn prices more than a third higher since mid-June.
“It is dry across much of the Midwest and Plains and there
is no relief in sight,” said Alan Reppert, senior meteorologist
at AccuWeather.com. He said the most affected areas were from
Iowa to Illinois, the heart of the Corn Belt.
Chicago Board of Trade (CBOT) December futures jumped
2.5 percent to $7.10-1/2 per bushel in opening Sunday night
trade, touching a new contract high and reversing Friday’s
losses. Wheat and soybeans rose more than 1 percent.
“The good news for this week is that temperatures are due to
slip back from last week’s record readings, the bad news is that
all of the rain forecast is for the southern third of the
nation,” ABN Amro analyst Charlie Sernatinger said in a note to
clients.
He said Nebraska and Kansas had seen some rain over the
weekend, but the eastern Corn Belt was unlikely to have any
showers until the middle of next week, according to extended
forecasts.
The latest U.S. Drought Monitor report, released on
Thursday, showed drought encompassing more of the contiguous
United States than at any other time since the report began in
January 2000.
The blistering heat has begun to ease, however, with a
slow-moving front of cool air from Canada starting to push down
temperatures on Sunday from Minneapolis to Detroit to
Pittsburgh.
The temperature in Chicago, which had three consecutive days
of triple-digit temperatures in the past week, was a pleasant 82
degrees Fahrenheit (25 C) early Sunday afternoon, according to
the National Weather Service.
(Reporting by Jonathan Leff and Scott DiSavino; Editing by Dale
Hudson)
