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Corn Has Longest Slump in Eight Weeks as Demand Ebbs

Feb. 7 (Bloomberg) -- Corn futures fell, capping the longest slump in eight weeks, as demand ebbed for exports and ethanol in the U.S., the world’s biggest grain shipper. Soybeans also declined.

In the week ended Jan. 31, U.S. exporters sold 168,918 metric tons of corn, down 76 percent from year earlier, Department of Agriculture data showed today. U.S. sales since Sept. 1 are 52 percent behind a year earlier. Grain-based ethanol production has declined, and plants are closing.

“Demand for U.S. corn is weak, whether it’s overseas feed buyers or domestic ethanol producers,” Chad Henderson, the president of Prime Agricultural Consultants Inc. in Brookfield, Wisconsin, said in a telephone interview. “Buyers will wait for lower prices.”

Corn futures for March delivery fell 1.6 percent to close at $7.1075 a bushel at 2 p.m. on the Chicago Board of Trade, the biggest decline for a most-active contract since Dec. 19. The price dropped for the fifth straight session, the longest slump since Dec. 13.

Soybean futures for March delivery fell 0.1 percent to $14.8675 a bushel. Earlier, the price climbed as much as 0.6 percent as China, the biggest consumer, increased purchases from the U.S.

In the week ended Jan. 31, U.S. exporters sold 696,600 tons of soybeans to China for delivery before Aug. 31 and an additional 691,000 tons for the 12 months starting Sept. 1, the USDA said today. U.S. sales of soybean meal since Oct. 1 to all destinations are 43 percent ahead of a year earlier, and soybean oil tripled.

“Chinese purchases of U.S. soybeans were a surprise,” Jerry Gidel, the chief feed-grain analyst for Rice Dairy LLC in Chicago, said in a telephone interview. “We are also selling more soybean meal and oil, and that will increase U.S. processor demand” for the oilseed, he said.

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

To contact the reporter on this story: Jeff Wilson in Chicago at jwilson29@bloomberg.net

To contact the editor responsible for this story: Steve Stroth at sstroth@bloomberg.net

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