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Soybeans Fall on Signs of Slowing Global Demand; Corn Falls, Halting Rally
Soybeans fell the most in more than a week on speculation that Chinese and U.S. demand is slowing after prices rose as much as 16 percent since the end of June. Corn fell for the first time in four sessions.
Soybean processors in Heilongjiang, China’s top-producing province, are in talks to buy government stockpiles, which may ease demand for imports from the U.S., the largest grower and exporter. U.S. inventories of soy-based animal feed rose 21 percent at the end of July from a year earlier, the Census Bureau said last week. Soybean-oil inventories rose to the highest level since December 2003.
“Chinese demand for U.S. soybeans may be slowing,” said Chad Henderson, a market analyst for Prime Agricultural Consultants in Brookfield, Wisconsin. “U.S. demand for soybean meal and cooking oils appears to be slowing.”
Soybean futures for November delivery fell 12.5 cents, or 1.2 percent, to close at $10.10 a bushel at 1:15 p.m. on the Chicago Board of Trade, after earlier gaining as much as 0.4 percent. The decline was the biggest since Aug. 19. Prices rose 0.5 percent in August, reaching a seven-month high of $10.49 on Aug. 5, as Chinese imports surged to a record.
Soybean-oil futures for December delivery fell 0.48 cent, or 1.2 percent, to close at 40.05 cents a pound in Chicago, the biggest decline since Aug. 19. The vegetable oil fell 1.2 percent in August, the third decline in four months.
China was expected to increase soybean imports by 20 percent to a record 49.5 million metric tons in the marketing year that ends Sept. 30, up from 41.1 million a year earlier, U.S. Department of Agriculture said on Aug. 12.
Corn Declines
Corn prices fell from a 14-month high on speculation that demand for ethanol will slow, after crude oil plunged 8.9 percent in August and rain improved prospects for global production of wheat, a competing livestock feed.
After the close of trading Aug. 27, the Commodity Futures Trading Commission reported speculator bets on rising corn prices rose to a record.
Corn speculators including hedge funds and commodity- trading advisers held long positions that exceeded shorts by 345,359 futures and options contracts as of Aug. 24, up 3.5 percent from a week earlier, the commission said.
“Commodity-wide selling was the feature to the last half of Tuesday’s trade,” said Mike Zuzolo, the president of Global Commodity Analytics & Consulting LLC in Lafayette, Indiana. “Program and end-of-the-month selling weighed on corn,” after the declines in oil and wheat prices, Zuzolo said.
Corn futures for December delivery fell 2.25 cents, or 0.5 percent, to close at $4.3925 a bushel on the Chicago Board of Trade. The most-active futures, which gained 8 percent in August, rose yesterday to touch $4.4525, the highest since June 2009.
The soybean crop in the U.S., the world’s largest grower, was valued at $31.8 billion last year, second only to corn at $48.6 billion, government figures show.
-- With assistance from William Bi in Beijing. Editors: Steve Stroth, Millie Munshi.
To contact the reporter on this story: Jeff Wilson in Chicago at jwilson29@bloomberg.net
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