Corn prices dropped the most since 2023 after the US Department of Agriculture raised its yield and production forecast, contrary to most analysts' expectations. The agency estimated corn output at about 16 billion bushels, up 1% from last month, beating Bloomberg's average prediction of 15.73 billion bushels.
Many believed the USDA would cut its outlook following searing summer heat and erratic rains. Instead, it hiked estimates using objective yield analysis based on random crop counts. With the harvest only about a quarter complete, the figures remain subject to change, leaving traders to grapple with more supply while awaiting potential purchases by China.
Futures fell as much as 6% to $4.7025 a bushel, the lowest since Aug. 11. The USDA's yield estimate of 181.2 bushels per acre exceeded expectations of 177.8, including record-high yields in Iowa, Ohio, Kentucky and Arkansas. The soybean and wheat outlooks were also generally higher than expected.
The price downturn hurt farm machinery maker Deere & Co., which fell up to 4.5%, along with rivals AGCO Corp. and CNH Industrial NV, as well as Bunge Global SA, Corteva Inc. and Nutrien Ltd.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing