Chicago corn drops as South American weather improve - Xinhua

CHICAGO, Jan. 18 (Xinhua) -- Chicago corn price slumped on Wednesday, as crop-friendly rainfall and more moderate temperatures were moving through most of drought-plagued Argentina. Wheat lost 2.1 percent and soybean remained unchanged.

The most active corn contract for March delivery trimmed 10.5 cents, or 1.7 percent, to close at 5.935 U.S. dollars per bushel. March wheat dropped 12.5 cents, or 2.1 percent, to 5.9225 dollars per bushel. March soybean remained unchanged, to close at 11.835 dollars per bushel.

Australia's bureau of meteorology reportedly announced Wednesday that "while La Nina conditions clearly remain, some indicators have weakened over the past fortnight,"providing relief to drought plagued crop in Argentina.

A continued confirmation in recent weather models that Argentina and southern Brazil could receive widespread relief of 0. 5 to 1.5 inches of rain for the weekend and early next week helped to drag down corn and soybean price earlier in the session, traders said.

"Trading continues to be dominated by South American weather. And right now the weather is turned to be bearish," said Frank Lesh with FuturePath Trading.

Argentina, which supplies about 20 percent of the world's corn exports, potentially lost 10 to 15 percent of corn crop and 1 to 2 percent soybean crop right now, Lesh predicted.

"Continuing calls for more precipitation this weekend, and possibly next week have turned these markets down. And traders are thinking that we've probably seen the worst of weather problems there in the South America now," Lesh added.

Meanwhile, the sharp decline in corn prices and active speculative selling in wheat market heavily weighed on the wheat price, while the positive outside market failed to lift grain prices.