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Corn, wheat fall after latest crop report

Corn, wheat fall after latest crop report

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NEW YORK -- Corn and wheat prices retreated Wednesday after the U.S. Department of Agriculture's monthly crop report showed plenty of supply for the two grains.

Soybean prices rose after the report showed a slight drop in supply.

The USDA's estimate for corn supply threw analysts for a loop for the second time in three months. Analysts had been forecasting overall corn supply to drop slightly in the latest forecast, but instead it rose sharply.

Jason Ward, an analyst with Northstar Commodity in Minneapolis, said there are now millions more bushels of corn available than previously thought because of various revisions to production and export estimates.

Corn is also being pressured by weak prices for ethanol.

"You've lost a big, big consumer" Ward said of ethanol producers who are now buying much less corn. Some producers are losing money right now because of the current cost of corn and the price of ethanol, he said. Demand for corn could be tempered until corn prices drop further or ethanol prices rise, Ward said.

Corn for May delivery dropped 3.5 cents to $3.655 a bushel.

Wheat also dropped because of oversupply. The Agriculture Department's report showed supply rose 20 million bushels to the 1 billion bushel level. The increase was due to a drop in demand from food producers.

May wheat fell 8 cents to settle at $4.815 a bushel.

Soybeans rose after the report showed supply fell slightly more than expected. May soybeans rose 10.5 cents to $9.58 a bushel.

Energy prices were little changed after two reports on supply and demand offset each other.

The Energy Information Administration said crude inventories grew less than expected last week. Inventories rose by 1.4 million barrels. Analysts expected a build of 2.1 million barrels, according to a survey by Platts, the energy information arm of McGraw-Hill Cos.

At the same time, OPEC revised its estimate for world demand higher. It said demand should grow by 900,000 barrels per day this year.

Benchmark crude for April delivery rose 60 cents to settle at $82.09 a barrel on the New York Mercantile Exchange.

In other Nymex trading in April contracts, heating oil rose 2.64 cents to settle at $2.1162 a gallon. Gasoline gained 2.48 cents at $2.2851 a gallon. Natural gas rose 4.3 cents to $4.559 per 1,000 cubic feet.

Meanwhile, metals all fell, led by gold. April gold dropped $14.20 to settle at $1,108.10 an ounce.

Silver for May delivery fell 32 cents to settle at $17.018 an ounce, while May copper fell 4.35 cents to $3.368 a pound.

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