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May 27th, 2014

Corn futures dropped to the lowest level since March on speculation U.S. farmers accelerated planting last week while rain in the next few days improves prospects for developing crops. Wheat declined to an 11-week low.

About 73 percent of corn in the main U.S. growing areas was planted as of May 18, near the five-year average pace of 76 percent and accelerating after cold weather delayed sowing earlier this year, U.S. Department of Agriculture data show. The USDA is set to update its weekly crop progress report later today. About 30 percent of the U.S. Corn Belt will see favorable rains early this week, QT Weather said in a report.

“Planting might have been late two and three weeks ago, but it is almost certainly back to the five-year average now, and we’d not be surprised to see both corn and soybean planting ahead of schedule,” economist Dennis Gartman said in his daily Gartman Letter. “Over the next few days we shall begin considering just how far down prices can fall.”

Corn futures for July delivery fell 1.2 percent to $4.725 a bushel at 7:05 a.m. on the Chicago Board of Trade. Earlier, the price touched $4.70, the lowest for a most-active contract since March 4. Markets in the U.S. were closed yesterday for the Memorial Day holiday. Soybeans for July delivery lost 1.1 percent to $14.995 a bushel.

Wheat for July delivery fell 1.5 percent to $6.4275 a bushel, after earlier touching $6.4125, the lowest for a most-active contract since March 11. Milling wheat for November delivery dropped 0.8 percent to 191.25 euros ($260.83) a metric ton on Euronext in Paris.

Western Texas and Oklahoma as well as parts of Kansas and Colorado saw rain during the weekend, easing dry conditions for winter wheat crops, QT Weather said. Most of the southern and central Great Plains were experiencing moderate to exceptional drought as of May 20, according to the U.S. Drought Monitor. The USDA, which reported last week that 44 percent of crops were in poor or very poor shape, will update its condition report today.

- Whitney McFerron in London and Phoebe Sedgman in Melbourne at Bloomberg.