CHICAGO (Dow Jones)--U.S. corn futures are expected to start lower Wednesday as selling in the wheat market and forecasts for beneficial weather pressure prices.
Traders predict corn for July delivery, the most actively traded contract, will open down 1 cent to 3 cents a bushel at the Chicago Board of Trade. In overnight electronic trading, the contract stumbled 1 3/4 cents, or 0.2%, to $7.45 3/4 a bushel.
Losses in wheat are weighing on corn as both grains are used for livestock feed. Wheat has tumbled since Russia said during the weekend it would resume grain exports July 1, fueling projections foreign demand for U.S. grain will fall due to an influx of Russian grain on the world market.
Traders are paying close attention to global demand for corn after futures reached record highs in April. Prices for the front-month contract have since pulled back 5%.
"A confirmation that Russia would be exporting wheat and starting in July was viewed as negative," according to Stewart Peterson, a risk management firm in Wisconsin.
Corn futures could feel additional pressure from expectations that warm, dry weather in the Midwest will be beneficial for the crop. Farmers have struggled to plant corn, particularly in Ohio and Indiana, this spring due to cool, wet conditions.
Still, grain users are nervous about the size of the crop and fear farmers won't plant as many acres as they intended due to poor weather. Farmers need to harvest a big crop to replenish inventories, which are projected to fall to a 15-year low this year due to strong demand.
"As of now, clear conditions on the radar, particularly in the eastern corn belt, produce the risk of weather premium being taken out" of prices, according to Stewart Peterson.
The U.S. Department of Agriculture said Tuesday 86% of the corn crop had been planted as of Sunday, below the five-year average of 95% for that time of year. In Ohio, just 19% of the crop was in the ground, below the average of 93% for that time of year.