Corn Jumps as French Crops Damaged by Intense European Heat Wave

Corn futures surged after a heat wave damaged crops in France, one of the European Union’s biggest producers of the grain.

The most-active contract in Chicago advanced 1.9% on Monday after trading was closed at the end of last week due to a US holiday. FranceAgriMer reported on Friday that crop conditions have worsened, following preliminary government estimates that extreme weather may have damaged almost a third of French corn. Traders are also monitoring hotter US temperatures.

“Should the heat further reduce yield potential,” prices for corn as well as wheat could extend their gains, said Joe Davis, director of commodity sales at Futures International LLC. Global supplies may tighten and shift import demand toward the US and South America, he added.

The market is also watching out for further details on US-China trade, after the Chinese government said last week the two countries have agreed in principle to include agricultural products in a reciprocal tariff reduction framework. Soybean crushers in the Asian nation usually start booking substantial volumes of new crop supplies from American farmers in August.

Tags: Chicago, corn