Corn slips as improved crop rating adds to supply pressure

Chicago corn fell on Tuesday as an unexpected jump in U.S. crop ratings reinforced expectations of ample supply of the cereal.

Soybeans eased as steady U.S. crop conditions along with a higher-than-anticipated quarterly estimate of U.S. stocks also maintained supply pressure.

Wheat was little changed, with fresh weakness in the dollar helping underpin prices in the face of an advancing harvest in the United States and elsewhere in the Northern Hemisphere.

In a report released after Monday's close, the U.S. Department of Agriculture rated 73% of the nation's corn crop in good-to-excellent condition. That was up from 70% a week ago, above a range of analyst estimates and the best score since 2018 at this point in the growing season.

Favourable U.S. crop prospects come as Brazilian farmers are harvesting what some analysts expect to be a record second-corn crop.

"U.S. weather is non-threatening, with warm temps and plenty of rain," Peak Trading Research said in a note.

The most-active corn contract on the Chicago Board of Trade (CBOT) ZC1! was down 1.5% at $4.19-1/4 a bushel by 1042 GMT

CBOT soybeans ZS1! were 0.7% lower at $10.19-3/4 a bushel, while CBOT wheat ZW1! inched up 0.1% to $5.38-3/4 a bushel.

In separate data on Monday, the USDA issued updated estimates of U.S corn and soybean acreage that were broadly in line with market expectations.

The agency pegged U.S. June 1 stockpiles of soybeans and wheat above average analyst expectations, though traders did not see significant changes.

"The USDA confirmed big corn acres and slightly higher soybean stocks, but didn't offer up any real surprises. Traders will now go back to focusing on weather and seasonals as we enter corn's important pollination window," Peak Trading Research said.

The latest fall for the dollar DXY, which hit its lowest since February 2022 against other major currencies, and a steadying in crude oil BRN1! lent some support to grains.

In Europe, corresponding strength in the euro EURUSD pushed Euronext wheat futures (BL2U5) to new contract lows, with traders also seeing limited risks to wheat crops from a heatwave in part of the region.