US MIDDAY: grains tumble
October 24, 2012: US grain futures tumbled on Tuesday as the dollar rose and equities fell on renewed concerns about the global economy, with soyabeans dropping nearly 1 percent, the biggest one-day loss in a week. Wheat slid more than 1 percent, reversing four consecutive days of gains, and corn also eased on signs of continued tepid export sales of US corn due to historic high prices.
Corn also was under pressure from hints that US cattle feeders were scaling back operations because of continued poor profits due to high feed costs. “Risk-off is in control at the moment, as the weaker equity markets are casting a long shadow on the markets this morning,” said Sterling Smith, futures specialist for Citigroup.
At 10:18 am CDT (1518 GMT), Chicago Board of Trade November soyabean futures were down 0.84 percent, or 13 cents, at $15.33-1/2 per bushel, December corn was down 1.44 percent, or 11 cents, at $7.50-1/4 per bushel, and December wheat was down 1.88 percent, or 16-1/2 cents, at $8.61-3/4 per bushel. “I would suggest that the outside markets’ firming is a return to risk-off trade in favour once again of buying the safe-haven assets of the dollar and bonds,” said Mike Zuzolo, analyst for Global Commodity Analytics.
The Thomson Reuters Jefferies Commodity Research Bureau index was down 1.43 percent at 299.1669. Corn found lingering pressure from the release on Friday of a US government cattle-on-feed report that showed the number of cattle placed in America’s feedlots in September was well below analysts’ average estimate and was the lowest September figure on record. Fewer mouths to feed in upcoming months would mean lower demand for corn, which remains priced at historically high levels.