Bloomberg News

Wheat Drops on Higher Global Reserve Estimate; Corn Declines

October 28, 2011

Oct. 28 (Bloomberg) -- Wheat fell in Chicago, paring a third weekly advance, on a prediction that global stockpiles will exceed a prior estimate as production climbs and demand wanes. Corn and soybeans dropped.

World wheat inventories will be 202 million metric tons at the end of the 2011-12 marketing year, up 4.7 percent from last month’s 193 million-ton forecast, the International Grains Council said yesterday. Output will total 684 million tons, above the 679 million tons forecast in September, as consumption retreats to 677 million tons, it said.

“This announcement is having a bearish influence on prices,” Michael Creed, an agribusiness economist at National Australia Bank Ltd., said by phone from Melbourne today. “That certainly has offset some of the strength provided by macroeconomic events overnight.”

Wheat for December delivery declined 1 percent to $6.3725 a bushel by 10:53 a.m. London time on the Chicago Board of Trade. The grain is up 0.8 percent this week and yesterday climbed the most in more than two weeks after European leaders agreed on steps to curb the region’s debt crisis.

Milling wheat for January delivery traded on NYSE Liffe in Paris gained 0.1 percent to 183.75 euros ($260.61) a ton.

Corn for December delivery dropped 0.6 percent to $6.475 a bushel in Chicago. The grain is down 0.3 percent this week.

Soybeans for January delivery retreated 0.5 percent to $12.3775 a bushel. The oilseed has climbed 1.4 percent this week.

--With assistance from Phoebe Sedgman in Melbourne and Luzi Ann Javier in Singapore. Editors: Dan Weeks, Sharon Lindores.

To contact the reporters on this story: Ranjeetha Pakiam in Kuala Lumpur at rpakiam@bloomberg.net; Tony C. Dreibus in London at tdreibus@bloomberg.net.

To contact the editors responsible for this story: James Poole at jpoole4@bloomberg.net


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