GRAINS-Corn falls for second day as US crop prospects improve

Tue Apr 23, 2013 2:47pm EDT

* Better US planting weather seen for next week
    * Abundance of rain has markedly eased drought worries
    * CBOT new-crop December corn contract to 10-month low
    * Strong cash soybeans lift spot soybean futures
    * Signs China's economy slowing weighs on grains

 (Updates prices to include close of U.S. trading, adds fresh
analyst quotes)
    By Sam Nelson
    CHICAGO, April 23 (Reuters) - Chicago Board of Trade (CBOT)
corn futures fell for the second consecutive trading session on
Tuesday on forecasts for better U.S. corn planting weather
beginning this weekend and on recent rainfall that eased drought
concerns and boosted production prospects.
    The CBOT new-crop December corn futures contract, the
month most sensitive to 2013 U.S. planting and growing weather,
fell to a 10-month low, trading down 10-1/4 cents per bushel at
$5.22-3/4.
    U.S. corn plantings have been stalled due to wet and cold
weather but the rainfall also has added valuable moisture to
drought-stricken soils.
    "The story has been delayed plantings and now the focus is
shifting to the weekend and next week and much better planting
weather," said Rich Nelson, chief strategist for Illinois-based
research and advisory firm Allendale Inc.
    Wheat also declined for the second consecutive trading
session on prospects for improved crop growing weather soon
while nearby or spot May soybeans turned higher, reversing two
days of declines, on strong cash soybean and soymeal markets.
    CBOT corn for May delivery was down 7-1/4 cents per
bushel at $6.38-1/2, May wheat was down 4-3/4 at $6.97-1/2
and soybeans for May delivery were up 2-1/2 at $14.19-3/4.
    Showers will linger in the Midwest on Thursday and there
will be more rain on Friday and Saturday in the southern
Midwest, said Don Keeney, meteorologist for MDA Weather
Services. 
    "Conditions will definitely change next week. It will be
much warmer and much drier next week," Keeney said.
    The U.S. Department of Agriculture (USDA), in its weekly
crop progress report released late on Monday, said only 4
percent of the U.S. corn crop had been planted, up from 2
percent a week ago but well behind the 16 percent five-year
average seeding pace. 
    Thirty-five percent of the U.S. winter wheat crop was in
good-to-excellent condition, down from 36 percent a week ago and
well below the 63 percent of a year ago.
    And, only 7 percent of the U.S. spring wheat crop had been
planted, up from 6 percent a week ago but well behind the 24
percent five-year average.
    CBOT new-crop November soybeans also were lower, down
6-1/2 cents per bushel at $11.96-1/4 on the improved U.S. crop
prospects but the old-crop spot May held to gains trading
up 2-1/2 at $14.19-3/4.
     "The strong bean basis and meal basis are kind of the last
remaining bullish factors here," the trader said.
    Soybean spot cash basis bids jumped to the highest levels
ever for this time of the year around the U.S. Midwest as the
domestic stockpile tightened amid a slow pace of export
shipments from South America, dealers said. 
    "In soybeans we're trading the tight stocks and demand
hasn't slowed. The strong cash market is leading the way up,"
Nelson said.
    Additional pressure on the wheat market came from signs of
slowing economic growth in China.
    "Other than reports of better weather conditions, poor
demand from China is also a factor behind both corn and wheat
being down," said Ker Chung Yang, commodities analyst at
Singapore-based Phillip Futures.
    Growth in China's vast factory sector dipped in April as new
export orders shrank, a preliminary survey of factory managers
showed on Tuesday, suggesting China still faces formidable
global economic headwinds into the second quarter.
 
    China is the worlds largest importer of soybeans and is
often a big consumer and buyer of other agricultural commodities
such as wheat and corn.
 Prices at 1:32 p.m. CDT (1832 GMT)      
                              LAST      NET    PCT     YTD
                                        CHG    CHG     CHG
 CBOT corn                  638.50    -7.25  -1.1%   -1.2%
 CBOT soy                  1419.75     2.50   0.2%   18.5%
 CBOT meal                  411.70     1.70   0.4%   33.1%
 CBOT soyoil                 48.57    -0.05  -0.1%   -6.8%
 CBOT wheat                 697.50    -4.75  -0.7%    6.9%
 CBOT rice                 1506.50    -4.00  -0.3%    3.1%
 EU wheat                   241.00    -2.75  -1.1%   19.0%
 
 US crude                    89.11    -0.08  -0.1%   -9.8%
 Dow Jones                  14,674      106   0.7%   20.1%
 Gold                      1410.89   -14.25  -1.0%   -9.8%
 Euro/dollar                1.2990  -0.0076  -0.6%    0.3%
 Dollar Index              83.0320   0.3560   0.4%    3.6%
 Baltic Freight                885       -4  -0.5%  -49.1%
   

 (Additional reporting by Michael Hirtzer in Chicago and Nigel
Hunt in London)
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