Chicago, June 27: US corn futures tumbled as rain in the main Midwestgrowing region continued to ease concerns over crop prospects sparkedearlier by drought conditions, while cocoa slid to seven-week lows. In otherfeatured markets, crude oil futures were lower amidsignals that producersmight take further action to curb prices that have soared in recent weeksamid tight supply.At the Chicago Board of Trade, corn futures cameunderpressure from weekend rains in the Midwest and forecasts for more goodcrop weather."Rain over the weekend was abundant, and they were talkingabouta ridge coming in, but it doesn'T look like it will last long," said analystDale Gustafson of Salomon Smith Barney.An atmospheric high-pressure ridge may form soon over theMidwest, leading toa brief spell of warm, dry weather, but meteorologists do not see the ridgeas a hindrance to crop development and growth.
The U.S. Corn crop is now entering its critical pollinationor reproductivestage of development. Barring any dramatic turn in weather conditions, arecord crop is expected this year.
Corn for delivery in July ended 5-1/4 cents lower at$1.94-1/4 per bushel. Astrong cash market buoyed by limited farmer selling because of poor priceshelped July delivery soybeans finish 1-1/2 cents higher at $4.99-1/2 perbushel.
At the New York Board of Trade, cocoa futures fell to aseven-week low intrading based on technical factors. Bargain hunting kept the market fromfalling further.The market was also getting over last week's rumours ofapolitical coup in top producer Ivory Coast."The political situation in thatcountry is terrible," abroker said. "Thursday's rumours (of a coup) wereonly an incident. Until something happens that affects the cocoa marketdirectly, there is nothing that the market can react to."
Cocoa for September delivery fell $34 a metric ton to settleat $820.At theNew York Mercantile Exchange, crude oil futures endedsharply lower onprofit-taking as Mexico, which does not belong to the Organisation ofPetroleum Exporting Countries, signalled that producers will take "furtheraction" to curb high oil prices. Mexico's Energy Minister Luis Tellez saidhe was "notcomfortable" with crude prices at $30 a barrel. His commentshelped weaken crude futures.
Mexico will increase its exports by 75,000 barrels per day(bpd) startingJuly 1 as part of producers' efforts to cool down the overheated markets.Mexico's action followed OPEC's agreement to increase output by 708,000 bpd,also beginning July 1.
Crude oil for August delivery settled at $31.63 a barrel,down 62 cents. Julyheating oil hit a session high of 82.20 cents a gallon but ended at 80.08,down 0.56 cent.July gasoline took the biggest hit in the day'sselloff,finishing at $1.0517 a gallon, down 2.93 cents.
Martin Baily, chairman of the president's Council ofEconomic Advisers, saidin Paris that the U.S. Administration was "pretty concerned" about oilprices but he did not see the rise in oil prices ending the U.S. Economicexpansion.
He said an oil price around $20 to $25 per barrel would besustainable in thelong run."We would like to see some greater stability in oil markets,"Bailytold a news conference at the annual ministerial meeting of the Organisationfor Economic Cooperation and Development.
Copyright © 2000 Indian Express Newspapers (Bombay) Ltd.