Corn Supply Dropping Most Since 1995 Signals U.S. Rally

U.S. corn supplies, the world’s biggest, are dropping at the fastest pace in 17 years as drought damage exceeds government forecasts and five months of declining prices spur demand from livestock producers.

Inventories on Dec. 1 were 15 percent lower than a year earlier at 8.22 billion bushels (208.8 million metric tons), the smallest post-harvest stockpile since 2003, according to the average of 26 analyst estimates compiled by Bloomberg. Goldman Sachs Group Inc., Morgan Stanley and Macquarie Group Ltd. expect prices to rebound at least 17 percent to $8.14 a bushel in 2013.