Corn Drops on Slowing Fuel, Export Demand; Soybeans, Wheat FallJeff Wilson
Corn declined for the first time in nine sessions after a government report showed slowing demand for the grain to make fuel in the U.S., and exports tumbled. Soybeans and wheat dropped.
Ethanol production fell last week to the lowest since the government began reporting data in June 2010, and inventories rose to the highest in four weeks, the Energy Department said yesterday. Export sales of corn were 48 percent smaller than a year earlier in the week ended Jan. 10, and commitments since Sept. 1 were down 49 percent compared with the same date a year ago.
“The slowdown in ethanol production will curb demand for corn,” Jerry Gidel, the chief market analyst for Rice Dairy LLC in Chicago, said in a telephone interview. “Corn exports remain depressed.”
Corn futures for March delivery slid 0.9 percent to close at $7.245 a bushel at 2 p.m. on the Chicago Board of Trade. The grain jumped 7.5 percent in the prior eight sessions, the longest rally since December 2011.
Corn and soybeans also fell as rain overnight in Argentina and forecasts for more in northern Brazil increased crop potential, reducing the outlook for U.S. exports when harvesting begins in South America next month, Roy Huckabay, an executive vice president for the Linn Group in Chicago, said in a telephone interview.
Soybean futures for March delivery declined 0.4 percent to $14.3025 a bushel on the CBOT. Earlier, the price touched $14.48, the highest since Dec. 19.
Wheat futures for March delivery slipped 0.5 percent to $7.8125 a bushel in Chicago, after gaining 5.4 percent the prior four sessions. Yesterday, the price touched $7.91, the highest since Dec. 26.
Corn is the biggest U.S. crop, valued at a record $76.5 billion in 2011, with soybeans in second place at $35.8 billion, government figures show. Wheat is the fourth-biggest crop, behind hay, with a value of $14.4 billion.