11 June 2012 22:21 [Source: ICIS news]
HOUSTON (ICIS)--The quality ratings for the 2012 US corn and soybean crops were downgraded from a week earlier, data released by the US Department of Agriculture (USDA) indicated on Monday.
USDA's weekly Crop Progress Report said that as of 10 June, 54% of the corn planted in the 18 top-producing states was rated in good condition while 12% was rated as excellent, compared with ratings of 57% good and 15% excellent a week earlier.
The quality ratings for the soybean crop also drooped as the USDA said 51% of the crop was good while 9% was excellent compared with ratings of 55% good and 10% excellent a week earlier.
A lack of rain in much of the corn belt last week had started to affect crop quality.
However, rain arrived in much of the midwest on Monday, prompting commodity traders to bid crop prices lower.
USDA crop quality ratings are an indication of future crop yields. Higher quality ratings generally translate to higher yields and can be a bearish signal to commodity traders.
In the US this year, about 5bn bushels of corn, 40% of the annual crop, will be used in the production of ethanol. Each bushel of corn on average yields 2.8 gallons of ethanol.
US soybean oil provides about 50% of the feedstock for the domestic production of biodiesel.
One bushel of soybeans yields enough oil to produce 1.5 gallons of biodiesel.
December corn futures closed at $5.34/bushel on Monday at the Chicago Mercantile Exchange, down about 10 cents/bushel from Friday's close. November soybeans closed at $13.31/bushel, down 1.2 cents/bushel.
US growers this year have planted an estimated 95.9m acres (38.8m hectares) of corn and 73.9m acres of soybeans.
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