By Luzi Ann Javier - Sep 15, 2011 9:04 AM GMT+0700
Corn retreated on signs that demand from producers of ethanol is declining and on concern makers of livestock feeds may seek cheaper substitutes. Wheat fell.
December-delivery corn lost 0.8 percent to $7.1875 a bushel on the Chicago Board of Trade at 9:48 a.m. Singapore time. The grain climbed 45 percent in the past year, beating a 3.5 percent decline in wheat.
Output of ethanol in the U.S. fell 1.9 percent to 879,000 barrels a day last week, the lowest level since the week ended July 29, according to a Department of Energy report. Feed millers will probably use less corn and more wheat in rations for livestock and poultry feeds, the Department of Agriculture said Sept. 12.
“The market has become increasingly focused on demand destruction in recent weeks,” Luke Mathews, a commodity strategist at Commonwealth Bank of Australia, said in a report today. “Wheat feeding is expected to displace an increasing proportion of corn use.”
Global corn use in animal feeds will drop to 505.1 million metric tons this season from 510 million tons estimated a month earlier, the USDA said Sept. 12.
Wheat for December delivery slipped 0.4 percent to $7.0150 a bushel in Chicago. The grain is trading at a discount to corn for a fifth straight day. Soybeans for November delivery were little changed at $13.83 a bushel.
To contact the reporter on this story: Luzi Ann Javier in Singapore at ljavier@bloomberg.net
To contact the editor responsible for this story: James Poole at jpoole4@bloomberg.net
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