Chicago Closing Comments

Corn: Dec 11 Corn closed at USD5.92 1/2, down the new 40 cents limit, Mar 12 Corn closed at USD6.05 3/4, also down 40 cents. Dec corn was 46 cents lower on the week and USD1.65 easier on the month. The last time we saw a front month begin with a five was before last Christmas. Funds expunged themselves of an estimated 30,000 contracts on the day as the USDA pegged September 1st stocks at 1.128 billion bushels, 164 million higher than what was expected and 208 million up on their August 2010/11 carryout estimate. The USDA numbers appear to confirm that prices in the USD7-8.00/bu region did induce some demand rationing across the summer. Weakness in crude added to the bearish tone for corn in particular.
Wheat: Dec 11 CBOT Wheat closed at USD6.09 1/4, down 45 cents; Dec 11 KCBT Wheat closed at USD7.04, down 36 cents; Dec 11 MGEX Wheat closed at USD8.92 1/4, down 3 1/4 cents. Minneapolis wheat held up well as the USDA pegged the HRS crop at 405 million bushels. CBOT Dec wheat fell 31 1/2 cents on the week, with Dec Kansas wheat down 27 1/2 cents and Dec Minneapolis up 41 1/4 cents. Funds were said to have sold 8,000 Chicago contracts on the day on spillover weakness from corn. The USDA pegged Sept 1st all wheat stocks a bit higher than trade estimates at 2.15 billion bushels. June-August disappearance was down 2% from last year at 720 million bushels. That's a surprise, as you would think that reduced corn usage across the summer would mean increased demand for wheat from the feed sector.