By Jeff Wilson May 12 (Bloomberg) -- Cash premiums for soybeans and corn shipped to export terminals near New Orleans widened relative to futures as U.S. farmers halted sales to wait for higher prices on optimism that demand will improve. The spot-basis bid, or premium, for soybean deliveries this month was 40 cents to 50 cents a bushel above July futures yesterday in Chicago, up from 40 cents to 44 cents on May 10, government data show. The premium for corn was 47 cents to 49 cents above July futures, compared with 47 cents to 48 cents. “Farmers are sporadic sellers, only letting go of dribs and drabs on rallies,” said Scott Stoller, a grain merchandiser at Michlig Agricenter Inc. in Manlius Illinois. “We’ve seen a pickup in exporter demand.” Soybean futures for July delivery rose 5 cents, or 0.5 percent, to $9.66 a bushel yesterday on the Chicago Board of Trade. Corn futures for July delivery gained 6.5 cents, or 1.8 percent, to $3.77 a bushel, the highest closing price for the most-active contracts since March 4. Rising domestic demand for corn and soybeans to make food, animal feed and fuel is helping to reduce the supplies left over from last year’s harvest that are moving to export terminals, Stoller said. Unsold corn inventories by Aug. 31, the end of the marketing year and before this year’s harvest, will total 1.738 billion bushels, compared with 1.899 billion forecast in April and 1.673 billion on hand a year earlier, the U.S. Department of Agriculture said yesterday in a report. Ethanol Use A record 4.4 billion bushels will be used to make ethanol, up from 4.3 billion estimated last month, the USDA said. Corn exports this year were forecast to rise to 1.95 billion bushels, more than the 1.9 billion estimated last month. The USDA yesterday raised its estimate for U.S. soybean exports in the marketing year that ends Aug. 31 to 1.455 billion bushels from 1.445 billion forecast in April and 1.283 billion bushels shipped in the previous year. The amount that will be processed into animal feed and cooking oil was forecast at 1.735 billion bushels, up 5 million from a month earlier. “With the harvest winding down in South America, farmers are slowing sales, and that means some export demand may shift to U.S. supplies,” Stoller said. “Domestic-processor demand is pretty good.” To contact the reporter on this story: Jeff Wilson in Chicago at jwilson29@bloomberg.net

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