Nov. 12 (Bloomberg) -- Soybeans fell, extending a slump to a four-month low, on signs of increasing supplies in the U.S. Midwest and South America. Corn dropped to the cheapest in six weeks.
World soybean inventories will be 60 million metric tons on Oct. 1, 4.3 percent more than forecast in October, the U.S. Department of Agriculture said on Nov. 9. The U.S. harvest will be 2.97 billion bushels, up 3.9 percent. Rain in northern Brazil will aid crop development, while drier weather accelerates planting in Argentina, World Weather Inc. said in a report today.
“There is a growing consensus that supplies are more plentiful, which will slow buying from end-users,” Greg Grow, the director of agribusiness for Archer Financial Services Inc. in Chicago, said in a telephone interview. “Generally favorable weather in South America is keeping pressure on the markets.”
Soybean futures for January delivery tumbled 3.2 percent to close at $14.05 a bushel at 2 p.m. on the Chicago Board of Trade. Earlier, the price touched $14.02, the lowest for a most-active contract since June 29. The oilseed, used to make animal feed and cooking oil, is 21 percent below the record $17.89 set on Sept. 4.
Corn futures for March delivery declined 2.7 percent to $7.2225 a bushel. Earlier, the price touched $7.1625, the lowest since Sept. 28. The grain has fallen 15 percent from the Aug. 10 record at $8.49.
Prices also fell as speculators reduced bets on a rally as supply concerns eased, Grow said.
In the week ended Nov. 6, hedge funds reduced bets on higher soybean prices by 5.5 percent to 164,528 futures and options from a week earlier, the lowest in almost eight months, government data showed on Nov. 9. Net-long positions in corn have slumped 31 percent from a 16-month high on Aug. 21.
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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