Forex Pros – Wheat futures were down for a second day on Tuesday, slumping to a three-day low as easing concerns over U.S. crop conditions pressured prices, which were also weighed by a stronger U.S. dollar.
On the Chicago Mercantile Exchange, wheat futures for September delivery traded at USD6.1988 a bushel during European morning trade, tumbling 2.82%.
It earlier fell as much as 3.3% to trade at USD6.1762 a bushel, the lowest price since July 7.
Favorable weather in the U.S. Great Plains and dry weather conditions in the northern U.S. wheat-belt aided harvesting of U.S. winter-wheat crops over the past week.
The U.S. Department of Agriculture said in its weekly crop progress report published Monday that nearly 63% of the U.S. winter-wheat crop was harvested as of July 10, up from 56% a week earlier and broadly in line with the five-year average.
Nearly 93% of Kansas’ winter-wheat crop was harvested, compared to 84% in the preceding week and above the five-year average of 91%.
The report showed that approximately 73% of the U.S. spring-wheat crop was rated in ‘good’ to ‘excellent’ condition, up from 70% a week earlier, while only 4% was rated ‘very poor’ to ‘poor’.
Kansas is the largest wheat-growing state in the U.S., which is the world’s biggest exporter of the grain.
Meanwhile, mounting fears that the euro zone’s sovereign debt crisis would spill over to the region’s core economies saw risk aversion sharpen, boosting demand for the safe haven U.S. dollar.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.6% to trade at 76.82, after earlier rising to 77.17, the highest since March 15.
A stronger dollar reduces the appeal of U.S. crops to overseas buyers and makes commodities less attractive as an alternative investment.
Elsewhere, corn for September delivery plunged 2.25% to trade at USD6.2850 a bushel, while soybeans for August delivery shed 0.6% to trade at USD13.3763 a bushel during European morning trade.
Later in the day, the USDA was to release estimates on agricultural supply and demand, including corn, wheat and soybeans.
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