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Harvest pressure turns grains lower

10/08/2013 @ 10:45am

Corn futures fell for the first time in five sessions on speculation that investors are liquidating bets that prices would rise as harvest speeds up and the government shutdown continues, creating a vacuum of information from which brokers can make trading decisions. Wheat also declined while soybeans were little changed.

Harvest may accelerate this week as dry weather moves into the Midwest, allowing farmers back into fields to collect corn and soybeans. The U.S. Department of Agriculture's crop progress report has been suspended because of the government shutdown, but analysts have said corn is about 25% harvested and soybeans are about 20% collected.

Because of the lack of information, investors may not be willing to hold any position in agriculture markets, said Arlan Suderman, a senior market analyst at Peoria, Ill.-based brokerage Water Street Solutions. The USDA said Monday that it would not release its monthly supply-and-demand report on Friday.

"Without the fundamental news the USDA is normally there to supply, the technicals are taking over, and why not trade lower through the harvest," said Frank J. Cholly, a senior commodities broker at RJO Futures in Chicago. "The upside is limited because we have a good amount of corn about to hit the pipeline."

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Chicago Board of Trade corn futures for December delivery on the CBOT gained 1 1/4 cents, or 0.3%, to $4.50 a bushel.

Corn production in the year that started on Sept. 1 was forecast last month by the USDA to total a record 13.8 billion bushels. Growers increased seeding after prices in August 2012 reached the highest ever, and yields this year are forecast to jump to 155.3 bushels an acre due to ideal weather during the growing season.

Wheat futures declined for the second time in three days after reaching the highest intraday price since June 21. CBOT contracts for December delivery fell 2 3/4 cents, or 0.4%, to $6.92 a bushel in Chicago. Wheat prices will "have trouble staying above $7" if corn prices continue declining because the two are interchangeable in animal feed, Mr. Cholly said.

Soybeans for November delivery rose 1 1/2 cents, or 0.1%, to $12.98 1/4 a bushel in Chicago.


Write to Tony Dreibus at tony.dreibus@wsj.com
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(END) Dow Jones Newswires
October 08, 2013 10:40 ET (14:40 GMT)
DJ Corn Falls on Harvest Pressure; Wheat Also Declines->copyright


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