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Uncertainty in the US weather forecast spurred a rally in Chicago Board of Trade (CBOT) corn futures on Monday, as volatility over increasing tensions in the US-China trade war roiled grain markets, traders said.

CBOT September corn rose 5-3/4 cents to settle at $4.05-1/4 per bushel. New-crop December corn closed the day up 5-1/4 cents to $4.14-3/4 a bushel.

Forecasts of cooler and wetter conditions across the US Midwest raised new concerns about how much of the current crop might be lost - as well as how much of the corn and soybean yields might be hampered by the stress of excess moisture.

Crops in as much as 30% of the Midwest are at significant risk for rain-related stress in the coming days, particularly in the Plains and portions of the western Midwest, according to a Commodity Weather Group report on Monday.

But limited rains and warmer patterns could impact corn and soybean fields in areas that have been far drier, including parts of Illinois, Indiana and Ohio.

China's Commerce Ministry said that Chinese companies have stopped buying US agricultural products, and that China will not rule out imposing import tariffs on US farm products that were bought after August 3.

US corn shipments fell to a 19-month low in June, and they were unlikely to have done much better in July as elevated prices and foreign competition continued to suppress export business for the world's top corn supplier.

Copyright Reuters, 2019


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