GRAINS-Corn sags on profit-taking; EPA ethanol move awaited

* Corn market bracing for smaller 2014 U.S. ethanol mandate
    * Soybeans end higher after choppy trade
    * Good South American soy crop prospects overhang market
    * Wheat firm on short-covering after seven-session slide

 (Updates with closing prices, adds ADM ethanol comment, wheat
export news)
    By Julie Ingwersen
    CHICAGO, Nov 13 (Reuters) - U.S. corn futures declined on
Wednesday as traders booked profits after a two-week high in the
previous session and braced for a possible reduction in the U.S.
government's 2014 quota of corn-based ethanol fuel used in
gasoline.
    Soybean futures firmed in choppy technical trade while wheat
	
ended a tick higher on short-covering after closing lower in each of the previous seven sessions. At the Chicago Board of Trade, December corn settled down 2-1/2 cents at $4.29-3/4 per bushel. January soybeans ended 1/2 cent higher at $13.15 a bushel and December wheat settled up 1/4 cent at $6.45-1/2 a bushel. Corn sagged on technical moves and worries that the U.S. Environmental Protection Agency would soon revise its Renewable Fuel Standard, or RFS, by lowering the amount of corn-based ethanol required in 2014 for blending into gasoline. Documents leaked earlier this year indicated the government might lower its corn-based ethanol requirement to 13 billion gallons, versus the 14.4 billion called for in the 2007 RFS law. "It's an uncertainty, and the bottom line is they are going to reduce," said Mark Schultz, analyst with Northstar Commodity in Minneapolis. "But if it stays at 13 billion (gallons), it's not super-negative," he added. Even with a lower mandate, U.S. ethanol production could reach 14 billion gallons in 2014 because of positive margins for processors and demand from buyers, Archer Daniels Midland Co's chief executive said. The corn market was seeking new direction after recent price rallies after a major U.S. Department of Agriculture report on
Friday. The USDA forecast a record U.S. corn crop, but its projection of 2013/14 ending stocks fell below market expectations. "Corn and wheat are drifting somewhat today, lacking direction as people still mull the impact of the USDA report on Friday," said Saxo Bank analyst Ole Hansen. "The corn rally this week was nowhere near price rises seen after surprises in some previous USDA reports. Some corn investors are happy to play for the short side, expecting falling prices as the large U.S. crop comes in," Hansen said. The U.S. corn harvest was 84 percent complete by Sunday, ahead of the five-year average of 79 percent, the USDA said in a weekly report. However, high levels of kernel moisture were a concern in Iowa, Nebraska, Wisconsin and other states, slowing progress. The U.S. soybean harvest was 91 percent finished, roughly in line with the five-year average of 92 percent. SOYBEANS TURN HIGHER Soybeans ended higher after spending much of the session in negative territory. But the benchmark January contract stayed inside of the previous day's trading range and below Tuesday's six-week top of $13.19-3/4. Favorable crop prospects early in the South American growing season hung over the market. U.S. and Brazilian government
forecasts have called a record-large Brazilian soybean harvest. "If you've got any hint that there would be a bean crop getting smaller in South America, then I could see the market making a pretty good push to the upside. But right now we've got pretty strong resistance at $13.20," said Schultz, referring to the CBOT January soybean contract. December soymeal settled down $4.40, or 1 percent, at $423.30 per short ton, dropping from a near two-month high set Tuesday, but strong domestic and export demand for U.S. meal underpinned values. CBOT wheat edged higher to halt its seven-session losing streak, but ample global wheat supplies hung over the market. Kansas City December hard wheat futures, also traded at the CBOT, posted an 11th straight lower close. But the slide appeared to attract export demand, as Brazilian importers bought at least 60,000 tonnes of U.S. hard red winter wheat for December shipment. After the CBOT close, the main government wheat buyer for Egypt, the biggest global wheat importer, said it was seeking soft and/or milling wheat for early December and would announce results of an international tender on Thursday. Prices at 2:56 p.m. CST (2056 GMT) LAST NET PCT CHG CHG CBOT corn 429.75 -2.00 -0.5% CBOT soy 1315.00 0.50 0.0% CBOT meal 423.30 -4.40 -1.0% CBOT soyoil 40.96 0.21 0.5% CBOT wheat 645.50 0.25 0.0% CBOT rice 1560.00 7.00 0.5% EU wheat 203.25 -0.75 -0.4% US crude 93.80 0.76 0.8% Dow Jones 15,815 65 0.4% Gold 1273.30 5.69 0.4% Euro/dollar 1.3460 0.0025 0.2% Dollar Index 80.9240 -0.2680 -0.3% Baltic Freight 1531 -12 -0.8% (Additional reporting by Michael Hogan in Hamburg and Naveen Thukral in Singapore; Editing by William Hardy, Krista Hughes and Steve Orlofsky)

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