Corn sinks to 7-month low on robust Midwest crops

NEW YORK — Corn prices sank to a seven-week low Monday as crops extended their rebound from last month's flooding, promising some relief at the grocery store for consumers who had faced higher prices for meat, dairy and other foods.

Other commodities traded mixed, with crude oil, gold, silver and copper rising. Soybeans, wheat and other agriculture futures fell.

Corn has plunged 20 percent in the last month, driven lower by ideal growing weather in the U.S. Corn Belt and a big drop in oil prices last week. The grain soared to record-highs near $8 a bushel in June as the worst flooding in 15 years ravaged the Midwest. The return to warm, dry weather in recent weeks has reinvigorated crops, wiping out all the previous rally's gains.

"It's as if the June flooding didn't even happen," said Vic Lespinasse of Grainanalyst.com. "The entire rally in corn has been taken off."

He said many analysts now predict corn could produce a respectable yield of 150 bushels per acre, up from about 148 bushels per acre a few weeks ago.

The favorable outlook sent corn December corn prices down 20.25 cents to settle at $6.0825 a bushel on the Chicago Board of Trade, after earlier falling to $6.03, the lowest since May 29.

Other agriculture futures also turned lower. Soybeans for November delivery shed 45 cents to settle at $14.03 a bushel on the CBOT, while September wheat lost 13 cents to settle at $7.91 a bushel.

Lower corn prices mean consumers likely won't suffer the sticker shock at the grocery store had prices stayed near the $8-a-bushel level. Since livestock owners rely on corn to feed their animals, the price of everything from steak to eggs and pork chops would have gone up sharply to offset the rising cost of corn-based animal feed. Corn is also used in cereal and as as a sweetner in soda, candy and other food items.

"It should mean some relief as far as additional price hikes," Lespinasse said.

In energy markets, crude oil ended higher for the first time in a week Monday as the prospect of new sanctions against Iran stoked worries of more Mideast tension. The threat to oil infrastructure from a tropical storm brewing in the Gulf of Mexico also boosted prices.

Light, sweet crude for August delivery rose $2.16 to settle at $131.04 a barrel on the New York Mercantile Exchange.

Other energy futures also rose. August heating oil futures rose 5.64 cents to settle at $3.7479 a gallon while gasoline futures rose 4.62 cents to settle at $3.2171 a gallon.

In precious metals, gold futures gained slightly as the dollar fell against the euro, boosting the metal's appeal as a hedge against inflation.

Gold for August delivery rose $5.70 to settle at $963.70 an ounce on the Nymex.

Other metals also rose Monday. September silver gained 22.5 cents to settle at $18.425 an ounce on the Nymex, while September copper rose 1.2 cents to settle at $3.681 a pound.