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GRAINS-U.S. corn off on talk of ethanol law change; soy firm

* CBOT corn down 1.1 percent, nears key $4.35/bushel mark
    * Soybeans remain positive but well off highs
    * Wheat dips after Egypt scuttles tender

 (Recasts, updates with U.S. trading, adds new analyst quote,
changes byline; pvs PARIS/SYDNEY)
    By Mark Weinraub
    CHICAGO, Oct 10 (Reuters) - Chicago Board of Trade corn
futures fell to a nearly three-year low on Thursday, pressured
by talk that the U.S. government will cut its requirement for
ethanol usage, traders said.
    U.S. wheat futures also fell as Egypt, the world's top buyer
of the commodity, canceled a tender for supplies. Soybeans edged
higher on a mild short-covering bounce. Corn faced additional pressure from the ongoing harvest of the U.S. crop, which traders said was coming in above expectations, and some profit-taking after prices rose in three of the previous four sessions. "Corn is taking some heat," said Karl Setzer, grains analyst at MaxYield Cooperative in Iowa. "Even as we (harvest) what was considered the worst areas of the Corn Belt, where there was some concern, yields are still coming out about 20 to 25 bushels an acre better than what was expected." At 10:55 a.m. CDT (1555 GMT), CBOT corn for December delivery was down 4-3/4 cents at $4.38-3/4 a bushel. The market was finding support at $4.35 a bushel, a price hit last week that was the lowest since September 2010. Traders said there was talk of the Environmental Protection Agency dropping the ethanol mandate for 2014 and 2015 by 6 to 10 percent, which would reduce the amount of corn needed to produce the fuel. CBOT December wheat was 1 cent lower at $6.89-1/2 a bushel. Egypt's GASC, the main government wheat buyer, said on Thursday it had canceled a tender for wheat for shipment Nov. 21-30 due to high prices. GASC issued the tender Wednesday afternoon.
CBOT wheat has risen 7.2 percent since the start of September. Soybeans firmed following two straight days of declines, but the market came off its highs due to the drop in corn. Traders also said soybeans had trouble holding support above the 50-day moving average. CBOT November soybeans were up 3-1/2 cents at $12.91-1/4 a bushel. Prices peaked at $13.02 earlier in the trading day. Traders continued to cast about for fresh fundamental news in the absence of reports from the U.S. Agriculture Department. The partial shutdown of the federal government left traders without the weekly export sales report for the second Thursday in a row. Additionally, there will be no monthly crop report or world supply and demand estimates. USDA originally planned to release those closely watched reports on Friday. Prices at 10:58 a.m. CDT (1558 GMT) LAST NET PCT YTD CHG CHG CHG CBOT corn 438.25 -5.25 -1.2% -37.2% CBOT soy 1364.00 3.50 0.3% -3.9% CBOT meal 425.80 0.60 0.1% 1.2% CBOT soyoil 40.78 0.23 0.6% -17.0% CBOT wheat 634.00 -1.50 -0.2% -18.5% CBOT rice 1510.00 -2.50 -0.2% 1.6% EU wheat 198.75 1.25 0.6% -20.6% US crude 103.14 1.53 1.5% 12.3% Dow Jones 15,035 232 1.6% 14.7% Gold 1300.51 -6.08 -0.5% -22.3% Euro/dollar 1.3531 0.0008 0.1% 2.6% Dollar Index 80.4230 0.0470 0.1% 0.8% Baltic Freight 2011 -114 -5.4% 187.7% In U.S. cents, benchmark contracts, except EU wheat (euros) and
soymeal (dollars). CBOT wheat, corn and soybeans per bushel, rice per hundredweight, soymeal per ton and soyoil per lb. (Reporting by Mark Weinraub; Editing by John Wallace)

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