Corn may gain on speculation that production in the U.S., the top producer and exporter, will be lower than estimated. Wheat futures declined. December-delivery corn gained as much as 0.5 percent to $7.515 a bushel on the Chicago Board of Trade before trading at $7.4875 by 11:17 a.m. in Singapore. Futures advanced 19 percent this year after a 15 percent rise last month. U.S. corn production probably will be smaller than the government forecast last month after unusually warm, dry weather in July and August damaged Midwest crops, according to a survey of as many as 30 analysts by Bloomberg News. Informa Economics Inc. and Allendale Inc. also said this week that production of the nation’s largest crop will fall below the Department of Agriculture’s forecast in August. “If we get some of these bad yield numbers that have been talked about, corn’s still reasonably well priced,” said Paul Deane, an economist at Australia & New Zealand Banking Group Ltd. in Melbourne. “It’s probably a few stepping into buy a little bit ahead of the USDA report,” and after yesterday’s sell-off. The USDA is scheduled to update its estimates on Sept. 12. Production may total 12.554 billion bushels, compared with the government’s estimate of 12.914 billion, according to the average estimate in the Bloomberg survey. Yields may be 149.2 bushels per acre, compared with the USDA estimate of 153 bushels per acre, according to the survey. Soybean production will also likely be less than the USDA forecast, it said. Decreasing Demand Corn futures fell 1 percent yesterday, the fourth decline in five sessions, on signs that demand is decreasing for supplies from the U.S. as growers including France and Ukraine boost output. “The fundamentals are still pretty good for the grain side of things, particularly corn,” Deane said. “It could be that after the heavy selling we’ve seen on global markets over the last week, with the turnaround overnight, that we are seeing speculative interests come back in to it a little bit.” Equities rallied yesterday amid speculation President Barack Obama’s plan for more than $300 billion in economic stimulus will boost growth. Global corn stockpiles were forecast by the USDA to plunge in the 2011-2012 season to 114.5 million metric tons, the lowest level in five years, as hot weather in the U.S. curbs yields and demand climbs for the grain. Soybeans for November delivery traded little changed at $14.2175 a bushel. The oilseed has climbed 35 percent in the past year. Wheat for December delivery declined 0.3 percent to $7.4925 a bushel, after rising as much as 0.5 percent. The grain advanced 5.4 percent in the past year. To contact the reporter for this story: Phoebe Sedgman in Melbourne at psedgman2@bloomberg.net To contact the editor responsible for this story: Richard Dobson at rdobson4@bloomberg.net

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