Ok, it was nothing new that dryness took a high place on the agenda in Chicago on Monday, after the worst drought on record in Russia and all.

"Dry weather remains a concern in Russia as they remain dry for this week, although half of the wheat growing area is forecasted to receive rain in extended six-to-10 day maps," broker Benson Quinn Commodities said.

In Argentina , a government report said that wheat sowings in some parts had been "paralyzed by the lack of soil moisture".

But it was something new that the parched conditions reflected US soil too.

"There are fears around about the hard red winter [wheat] plantings," a London analyst told Agrimoney.com, noting growing talk that rain was running short of ideal as farmers looked to next year's crop.

Stunted corn 

And it wasn't just wheat which was the concern, with Benson Quinn also noting "dry US Midwest weather forecasts for the next 10 days".

"The dry weather is promoting corn maturation which is expected to stunt test weights," the broker said.

Indeed, the US Department of Agriculture's weekly crop ratings are expected to show a drop of 1-2 percentage points in the proportion of US corn in "good" or "excellent" condition, albeit leaving it in fine form. (A similar drop is expected in the soybean rating too.)

But whereas wheat jumped 2.0% to $6.92 � a bushel in Chicago for September delivery, and up 1.9% to $7.25 � a bushel for December, corn was not so fortunate.

Chicago's September corn lot fell by 1.0% to $4.17 a bushel.

'Overcrowded longs'

The difference? One was the growth in the long positions held in Chicago corn by non-commercial investors which, as Rabobank said, "had its largest weekly increase in history", rising by 57,000 lots.

Factoring in shorts, the net long position rose by 59,000 contracts to 293,722 lots, not far off the record 312,921 contracts reached early in 2007.

"It appears that the corn market is becoming overcrowded on the long side," Rabobank said, the danger being that investors take profits any upward move, and take fright on a negative scare, so making the market risk appeared skewed to the downside, as they say.

The bank added that "the combination of growing scepticism regarding US corn yields with an increasing demand profile and expectations of further speculative capital inflows makes it difficult to be at all bearish".

Import orders

Still, with ProFarmer's corn yield forecast, from last week's Midwest tour, coming in only marginally below the USDA's estimate, and with harvest due to start in southern parts of Illinois this week, there was some pressure on prices from supply factors.

Nor did corn have the same support on demand from wheat, for which US export inspections were reported at 21.5m bushels, well above trade estimates.

And Europe had a couple of tenders wins to boast of too, from Tunisia, 50,000 tonnes of milling wheat and the same of feed barley, and Jordan, 100,000 tonnes of wheat.

Indeed, Paris milling wheat for November jumped 2.2% to E214.25 a tonne.

There was less luck for London feed wheat, which managed only a 0.2% rise to �149.95 a tonne, held back by a wet northern European harvest, which is raising concerns that even though the quantity of the crop may not turn out too bad by historical comparison, plenty of milling wheat will be downgraded.

Soybean debate 

Back in Chicago, soybeans were mixed, with the September lot ending 0.2% lower at $10.07 a bushel and the new crop November lot adding the same to $10.06 a bushel.

"The soybean trade is more comfortable with growing soybean production but concerned the demand will remain large," US Commodities said.

"By September 1, we will have sold 40% of the USDA export projections" for 2010-11.

Bullish sentiment was crushed by a negative close for soybeans on the Dalian exchange in China, the world's biggest buyer of the oilseed.

Also, soyoil reversed early gains, shedding 0.7% to end at 39.27 a pound in Chicago.

'Magical psychological numbers'

Among softs, sugar made it over the 20-cents-a-pound mark at the close, by all of 0.07 cents for New York's October contract � heralding perhaps more gains ahead?

"Unusual things tend to happen around the magical psychological numbers and none is perhaps bigger than the 20 cents level," Thomas Kujawa at Sucden Financial Sugar said.

The bulls "have the wind to their backs" with wet weather patterns, "particularly in Asia and over the ports in centre south Brazil, still a major concern with, for example, Pakistan experiencing something of Biblical proportions".

"A strong close tonight and it seems this stellar run by the bulls will continue," he added, talking before the finish.

London white sugar ended 0.6% higher at $577.80 a tonne.

Slumping beans? 

New York coffee hit its highest for nearly 13 years, as measured by a nearest-but-one contract (currently December), only to fall back in late deals, amid some doubts about the resilience of its rally.

"We are still convinced that this rally is not lasting," Commerzbank said, adding that it expected the scarcity of beans which has driven up prices to "ease in the fourth quarter".

A big Brazilian crop of arabica beans, the type traded in New York, is, after all, on its way.

The December lot ended down 1.80 cents at 183.25 cents a pound, having touched 188.65 cents a pound earlier.