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Corn rises on export news

11/13/2012 @ 3:46pm

U.S. wheat futures fell Tuesday, pressured by tepid wheat demand and overall weakness in grain and soy markets.

Chicago Board of Trade December wheat futures settled down 6 3/4 cents, or 0.8%, at $8.51 a bushel, a four-week low. KCBT December wheat fell 2 3/4 cents, or 0.3%, to $8.87 3/4 a bushel. MGEX December wheat fell 2 1/4 cents, or 0.2%, to $9.22 1/4 a bushel.

Wheat futures have plunged since the U.S. Department of Agriculture on Friday cut its forecast for U.S. exports of the grain, resulting in a higher forecast for domestic wheat stocks, the end of the crop's marketing year.

The USDA cut its export forecast by 50 million bushels, or 4.3%, to 1.1 billion bushels, and it forecast U.S. ending stocks of wheat will be 704 million bushels, higher than analysts had expected.

Concerns about weak demand persisted. The USDA said Tuesday 10.46 million bushels of wheat had been inspected or weighed for export in the week through last Thursday. That was near the low end of analysts' expectations that ranged from 10 million to 15 million bushels.

CBOT December wheat on Tuesday settled down 5.7% from its close on Thursday, before the USDA released its report.

"People would be a lot happier about being long wheat if Egypt or someone else showed up and wanted to buy a lot of wheat," said Helen Pound, a broker for Knight Capital Group. Despite analysts saying for weeks that U.S. wheat exports could pick up soon as competing exportable supplies run low in the Black Sea area, "we have not seen the business," Ms. Pound said.

The decline in wheat added to a wave of selling in grain and soy futures by managed funds, Ms. Pound said. "I think this is basically a washout of investor money and not necessarily tied into what's going on with the fundamentals," she said.

Corn futures rose on news of an export sale. The USDA said private exporters reported sales of 158,496 metric tons of corn for delivery to unknown destinations during the current marketing year.

The export sale highlighted concerns that lower prices could attract extra demand, straining already tight supplies.

December corn futures rose 5 1/2 cents, or 0.8%, to $7.23 1/2 a bushel.

Soybean futures ended mixed, with nearby futures slightly higher on tight current supplies and strong U.S. cash markets. Prices for physical soybeans in cash markets remain at historically high levels. But gains in futures were limited by improved expectations for the current U.S. soy crop.

November soybean futures, thinly traded ahead of the contract's expiration on Wednesday, rose 16 cents, or 1.1%, to $14.27 a bushel. January soybean futures rose 3 cents, or 0.2%, to $14.08 a bushel.

Write to Owen Fletcher at owen.fletcher@dowjones.com

Subscribe to WSJ: http://online.wsj.com?mod=djnwires

(END) Dow Jones Newswires

November 13, 2012 15:49 ET (20:49 GMT)

DJ U.S. GRAIN AND SOY REVIEW: Wheat Falls on Weak Demand->copyright
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