(Reuters) – Chicago corn fell again on Wednesday following a short rally a day earlier when the market bounced from a three-year low, with prospects for a record U.S. crop and reduced corn demand weakening prices.
Wheat traded little changed after bargain-hunting caused the largest gains in more than a month in the previous session, while soybeans slipped slightly on demand concerns.
“I think market attention is coming back to the large crops being gathered in the U.S. and elsewhere and this is weakening prices today, especially corn,” Commerzbank analyst Carsten Fritsch said.
“Big supplies are facing the global market, as the record U.S. crop reaches its final stages.”
Chicago Board of Trade December corn was down 0.4 percent at $4.15-3/4 a bushel at 1215 GMT, after firming 1.4 percent on Tuesday. Corn had fallen to $4.10-3/4 on Tuesday, the lowest since Aug. 26, 2010, before turning higher.
Chicago December wheat was little changed, up 0.04 percent at $6.50-1/2 a bushel and January soybeans fell 0.04 percent to $12.77 a bushel.
The U.S. Environmental Protection Agency on Friday proposed a cut in federal requirements for compulsory U.S. biofuel use next year, including corn-based ethanol.
Meanwhile, U.S. farmers are in the final stages of a record U.S. corn crop set to replenish global supplies.
“We have seen a recovery in corn prices, but the reality is that the bear market in corn persists as we continue to see a very significant rebound in global supplies,” said Luke Mathews, commodities strategist at the Commonwealth Bank of Australia.
“It is simply a reflection of some of the traders taking profits off the table.”
Concern about export demand also weighed.
“The continued sales of Black Sea region corn to South Korea, seen again today in the tender from the Major Feedmill Group, are also pressuring corn,” a European trader said.
The U.S. Department of Agriculture said on Tuesday private exporters reported the sale of 240,000 tonnes of U.S. soybeans to top importer China, but surprised dealers with the news that delivery is not scheduled until the next marketing year.
“There is talk that China may have covered much of its soybean import needs up to the end of February, when the Brazilian crop will be coming in,” another European trader said.
“This could slow export demand for U.S. soybeans in the coming months.”
U.S. wheat, meanwhile, continues to face heated competition from cheaper supplies in the Black Sea region.
Egypt’s state grains buyer GASC on Tuesday bought 120,000 tonnes of Russian wheat for shipment in December, the second deal for the world’s largest importer of wheat in the past week.
