Forexpros – Corn futures were down sharply for a second day on Monday, tumbling to a ten-month low as larger-than-expected U.S. corn supplies continued to pressure prices.
On the Chicago Mercantile Exchange, corn futures for December delivery traded at USD5.7875 a bushel during European morning trade, tumbling 2.19%.
It earlier fell by as much as 2.9% to trade at USD5.7238 a bushel, the lowest price since December 13, 2010.
The U.S. Department of Agriculture said in its quarterly Grain Stocks report published Friday that U.S. corn stockpiles stood at 1.13 billion bushels as of September 1, 17% higher than expectations for 962 million bushels and 23% higher than a previous estimate of 920 million bushels.
Global corn consumption fell 2.3% to 2.54 billion bushels in the three months ended August 31, down from 2.60 billion bushels a year earlier.
The U.S. is both the world’s largest corn producing nation and the world’s largest exporter of the grain.
Wall Street investment bank Goldman Sachs maintained its USD7 a bushel corn price forecast, but said that the “probability for an extreme bull case in prices is diminished”, following the USDA report.
Grain prices came under further pressure amid mounting fears over a Greek sovereign debt default and fresh concerns over a slowdown in Chinese economic growth.
The concerns over the global economic outlook saw risk aversion sharpen, boosting the safe-haven U.S. dollar. The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.21% to trade at 79.45.
A stronger dollar reduces the appeal of U.S. crops to overseas buyers and makes commodities less attractive as an alternative investment.
Elsewhere on the Chicago Mercantile Exchange, wheat for December delivery fell 0.84% to trade at a 14-week low of USD6.0388 a bushel, while soybeans for November delivery slumped 0.81% to trade at a 12-month low of USD11.6938 a bushel.
Later in the day, the U.S. Department of Agriculture was to publish its weekly crop progress report, which will provide an indication on how U.S. crops fared over the past week.
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