US corn extends gains, USDA report awaited

LONDON: US corn futures edged higher on Wednesday, building on the prior session's limit-up gains, while wheat and soybeans fell back slightly after the biggest rally in more than one year.

Dealers said markets were largely treading water ahead of a US Department of Agriculture crop report due to 1230 GMT.

"Operators must be cautious before the USDA report," French analyst Agritel said, noting short covering ahead of the report had helped to fuel the run-up on Tuesday.

Analysts, on average, expect the USDA to lower its estimate of this year's corn crop by 1 percent from last month's forecast, due to a decline in harvested acres.

They were expecting the soy crop to be flat from a month ago, while stocks were seen rising 11 percent from the September forecast as high prices probably slowed demand.

"No one wants to take a new position ahead of a report that could result in a limit down or limit up," said Adam Davis, a senior commodity analyst at Merricks Capital in Melbourne.

Chicago Board of Trade December corn rose 0.8 percent to $6.50 a bushel by 1111 GMT, after rising by its daily limit of 40 cents on Tuesday.

Copyright Reuters, 2011