Friday 30 November 2012

Corn Futures Drop as Export Demand Ebbs; Soybeans Advance

By Jeff Wilson - Nov 30, 2012
Bloomberg
Corn futures fell from a five-week high as demand by producers of grain-based fuel, animal feed and food ebbed. Soybeans gained.

U.S. export sales of corn in the week ended Nov. 22 tumbled 69 percent to 263,140 metric tons from a week earlier, the Department of Agriculture said today.

Production of ethanol slid 1 percent in the week ended Nov. 23 to the lowest in five weeks, the Energy Department said yesterday. The number of chicks placed on feed last week dropped 3.8 percent from a year earlier, USDA data show.

“The rally in prices slowed exports and ethanol production,” Jerrod Kitt, the director of research at the Linn Group on Chicago, said in a telephone interview. “The drop in chicken production also weighed on the market.”

Corn futures for March delivery dropped 0.7 percent to close at $7.5875 a bushel at 2 p.m. on the Chicago Board of Trade. Yesterday, the price reached $7.675, the highest for a most-active contract since Oct. 19. The grain has gained 17 percent this year after a Midwest drought reduced production.

Soybean futures for January delivery rose 0.1 percent to $14.48 a bushel in Chicago. Earlier, the price reached $14.60, the highest since Nov. 9. Export demand increased last week for animal feed and cooking oil made from supplies in the U.S., the world’s biggest producer.

U.S. exporters sold 365,058 metric tons of soy-based animal feed in the week ended Nov. 22, up 84 percent from a week earlier and the most in two years, the USDA said today. Soybean- oil sales surged more than 13-fold to 121,527 tons from a year earlier.

Corn is the biggest U.S. crop, valued at $76.5 billion in 2011, followed by soybeans at $35.8 billion, government figures show.

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