October 6, 2011


CBOT corn, wheat drop on softening demand for US exports



CBOT corn and wheat prices fell on October 4 as supply concerns eased amid indications of increased stockpiles and weakening demands for exports from the US.


Corn stockpiles in the US, the largest grower, totalled 1.28 billion bushels on September 1, 20% more than estimated by USDA analysts. It said that 2.15 billion bushels of wheat were in storage, beating analysts' estimates of 2.07 billion. Corn and wheat both fell 23% in September.


"There's only one big fundamental in the room, and it's the lingering fears from the September 30 report," said Christopher Gadd, an analyst at Macquarie Group Ltd. in London. "People are factoring that into the market."


Corn for December delivery declined US$0.09, or 1.5%, to US$5.84 a bushel. The grain is down 6.9% this year.


Corn inspected for export at US ports fell 18% to 28.4 million bushels in the week to September 29, from a week earlier, the USDA said. The nation's crop was about 21% harvested as of October 2, behind the five-year average of 23%, the agency said.


Rain may fall in parts of Kansas, Oklahoma and Texas, the biggest US producers of winter wheat, aiding establishment of recently planted crops and encouraging seeding, Joel Widenor, director of agriculture services at Commodity Weather Group LLC in Bethesda, Maryland, said in a report.


"A weekend rain event is likely to bring significant relief to about two thirds of the belt, with far western areas at most risk to see lingering dryness concerns and areas from central Nebraska through central Texas having the best chance for substantial rain," Widenor said.


Wheat for December delivery dropped US$0.085, or 1.4 %, to US$6.11 a bushel in Chicago. USDA export inspections for the grain rose the least since May in the latest week.


Milling wheat for November delivery traded on NYSE Liffe in Paris fell EUR2.50 (US$3.32), or 1.3%, to EUR182.75 (US$243.1) a tonne.


Soy for November delivery lost US$0.083 cents, or 0.7%, to US$11.7 a bushel in Chicago, on track for a third straight decline.

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