Corn prices in the US in July dropped by 18% from a late June peak due to a strong harvest, according to Reuters.

This year's harvest is forecast to be the second largest on record. Analysts and farmers explained that rain during July "shepherded the crop" through its critical development phase, offsetting dry conditions early in the season and hot summer temperatures.

Improved conditions in the field weighed heavily on the market as the drought damage from the early season was not as bad as feared.

Harvest in Brazil is also adding to the supply outweighing demand, as its harvest increased this year, and it is expected to overtake the US as the world's top corn supplier.

Drought-tolerant genes and other improvements in genetically modified corn allowed the crop to weather severe drought across much of the midwest, according to farmers

Genetically modified (GM) corn accounts for more than 90% of the US crop, according to Reuters.

A 4,000ac farmer from western Illinois, Drew DeSutter said: "With the technology that we have in the seed, the corn hung in there a lot better than people expected."

Corn forecast

Analysts said that in a monthly report due on Friday (August 11), they expect the US government to cut its forecast for domestic corn production to 15.135 billion bushels this year, from its July estimate for a record high 15.320 billion.

The new forecast, if achieved, would be the second biggest harvest ever, behind the 2016 harvest of 15.148 billion bushels.

Average yields were seen at 175.5 bushels/ac this year, which would be the fourth biggest ever.

The percentage of corn rated "good-to-excellent" this year by the US agriculture department (USDA) in weekly reports rose by 4% during July.

Good-to-excellent ratings of 55% on July 30, were the lowest for that time of year since the major drought year of 2012.

In the previous 30 years, good-to-excellent ratings for the corn crop had risen in July only six times.

A farmer who grows corn and soyabeans near Casey, Illinois, Eric Honselman said: "It has just been a roller coaster of a growing season.

"I just wish mother nature would make up her mind."