BLBG: Corn Declines as Investors Sell After Rally to Highest Price 33 in Months
Corn fell for the first time in five sessions in Chicago on speculation some investors are cashing in gains after a rally to a 33-month high.
Corn added 16 percent in four sessions through yesterday. The grain climbed after the U.S. Department of Agriculture released its quarterly stockpiles report on March 31, “steered by low inventory levels in the U.S.” and bets that China will import more of the grain, according to a Commerzbank Commodity Research report today.
“We’ve had a good run in corn,” Michael Pitts, a commodity sales director at National Australia Bank Ltd., said by phone from Sydney today. “We’re seeing just a little bit of profit-taking” by investors, he said.
Corn for May delivery fell 6 cents, or 0.8 percent, to $7.6075 a bushel by 11:46 a.m. London time on the Chicago Board of Trade. Inventories in the U.S., the world’s largest producer and exporter, slid to 6.52 billion bushels at the beginning of March, the lowest for that point since 2007, according to the USDA report.
Corn prices may keep rising, rationing demand that threatens to drain U.S. supplies, Commonwealth Bank of Australia said in a report today.
Inventories of the grain will probably fall to 589 million bushels by Sept. 1, before this year’s harvest, compared with 1.7 billion bushels last year and the USDA’s March estimate of 675 million bushels, according to the average estimate of 30 analysts surveyed by Bloomberg News. The USDA will release its latest outlook on U.S. and global agricultural supplies on April 8 at 8:30 a.m. in Washington.
Switch to Soybeans?
Heavy rains or flooding at the start of the U.S. planting season may also delay corn sowing, prompting farmers to shift to soybeans, National Australia Bank’s Pitts said.
Wheat for July delivery, the contract with the largest open interest, fell 2 cents, or 0.2 percent, to $8.2075 a bushel in Chicago after climbing as much as 0.7 percent. May-delivery wheat, which has the most volume, slipped 1.5 cents, or 0.2 percent, to $7.8475 a bushel.
Milling wheat for November delivery traded on NYSE Liffe in Paris, which has the most volume and open interest, rose as high as 221 euros ($316) a metric ton before erasing the gain and was last down 0.3 percent at 219 euros. Prices surged in the past year on demand for varieties of the grain to make bread and pasta.
Soybeans for May delivery increased for the first time in four sessions in Chicago, adding 7 cents, or 0.5 percent, to $13.8025 a bushel.
To contact the reporter on this story: Luzi Ann Javier in Singapore at ljavier@bloomberg.net
To contact the editor responsible for this story: Jim Poole at jpoole4@bloomberg.net
