Wheat fell for the second straight day on speculation that demand for the grain in U.S. livestock rations will decline following a price rally to a 15-week high. Corn gained, and soybeans dropped.
Yesterday, wheat’s premium to corn topped $2.50 a bushel, the highest since September 2010. The spread averaged $1.11 in the past five years. In March, wheat traded at a discount to corn, also used in animal feed. Wheat consumption rose 10 percent to 991 million bushels in the three months ended Aug. 31, the U.S. government said on Sept. 30.
“Wheat is no longer a competitive feed ingredient,” Jason Britt, the president of Central States Commodities Inc. in Kansas City, Missouri, said in a telephone interview. “Some traders are unwinding wheat versus corn spreads.”
On the Chicago Board of Trade, wheat futures for December delivery fell 0.4 percent to close at $6.905 a bushel at 1:15 p.m. Yesterday, the grain touched $6.9975, the highest for a most-active contract since June 24. The price has declined 11 percent this year. The U.S. is the biggest exporter.
Corn futures for December delivery rose 0.4 percent to $4.435 a bushel. Yesterday, the price slumped 1.7 percent, the most since Sept. 30. The grain has tumbled 36 percent this year.
Soybean futures for November delivery dropped 0.1 percent to $12.8775 a bushel.
In the next four days, soybean and corn collection across the Midwest will accelerate before rain returns on Oct. 13, Fred Gesser, the senior agricultural forecaster at Planalytics Inc. in Berwyn, Pennsylvania, said in a telephone interview. The average cash price of the oilseed has dropped 17 percent in the past 12 months, while corn has tumbled 42 percent, data from the Minneapolis Grain Exchange show.
“Harvesting is ramping up across the Midwest,” Chad Henderson, the president of Prime Agricultural Consultants Inc. in Brookfield, Wisconsin, said in a telephone interview. “Farmers are going to sell soybeans out of the field and store the corn because of the premium.”