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Corn, wheat close 'limit' down

Updated: 06/30/2011 @ 1:35pm

CHICAGO, Illinois (Agriculture.cm)--Thursday's bearish USDA June Acreage Report dropped corn and wheat markets to their daily 'limit' lows. 

Synthetically, the Sep. corn traded at $6.00 and Dec. is $5.86. Meanwhile, the Dec. corn futures closed locked 'limit' down 30 cents at $6.20 1/2. The Nov. soybean contract settled 29 cents lower at $12.94. The Sep. wheat futures closed down its daily limit of 60 cents at $6.14 1/4. The Dec. soybean meal futures contract closed $7.20 per short ton lower at $330.90 and Dec. soyoil futures closed $0.86 lower at $56.15.

In the outside markets, the NYMEX crude oil is $0.54 per barrel higher, the dollar is lower and the Dow Jones Industrials are up 104 points.

On Thursday, the July corn contract dropped 10%, wheat 8%, and it's the biggest drop in one month for corn since 2009. The report shows the 11th hour planting was bigger than we thought. Plus, the report indicates we are not using corn as much as we thought. 

Joe Bedore, FC Stone Inc.'s CME Group floor manager says the corn market has the chance to trade off its limit, because Friday's maximum daily limit will be moved from 30 cents to 45 cents.

"At this point, if the government is correct by estimating higher corn acres and higher corn stocks than the trade estimates, there is no good news for corn," Bedore says. "Do we think the government is absolutely correct, no."

Bedore adds, "You just can't have the added acres in North Dakota, with the flooding there. I've witnessed the crop problems in southern Indiana and Ohio. I just don't believe this higher acreage is going to work out the way they (USDA) thinks it will."

There is a rippling affect from this morning's bearish USDA Report. Fertilizer and tractor maker stocks are falling Thursday. 

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