CHICAGO: US corn futures jumped on Friday as government crop data signalled that livestock producers had not cut back on feeding the grain in favour of wheat, as some traders had expected.
The US Department of Agriculture, in a quarterly crop report, said 1.738 billion bushels of corn were in storage as of Sept. 1, fewer than analysts on average had expected. The inventory indicated that livestock producers had fed more corn to their animals than traders had anticipated, said Brian Hoops, president of brokerage Midwest Market Solutions.
The agency reported 2.527 billion bushels of wheat stocks at the start of the month, topping analysts' expectations. It estimated in a separate report that US all-wheat production was 2.31 billion bushels, which was lower than expected.
That showed that farmers had probably fed livestock less wheat than expected, said Arlan Suderman, chief commodities economist for INTL FCStone.
Some traders and analysts had projected wheat feeding would increase in the past quarter as wheat prices were under pressure from massive global supplies.
"We had felt like USDA was overestimating wheat feeding from the beginning, that there was too much cheap corn and sorghum out there," Suderman said. "These numbers seem to back that up."
Chicago Board of Trade most-active corn was up 1.6 percent at $3.34-1/2 a bushel by noon Central Time (1700 GMT). The contract had been trading lower before the USDA issued its stocks data.
Most-active wheat was 0.1 percent lower at $3.98-1/2 a bushel, and soybeans were up 0.5 percent at $9.54-1/2 a bushel.
The USDA said soybean stocks on Sept. 1 totaled 197 million bushels, compared to analysts' average estimate of 201 million.
These lower-than-expected corn and soybean stocks were giving prices "a little bit of a boost ahead of the weekend," Hoops said.
"Corn and beans don't look bullish, maybe just a little bit friendly," he said.
US corn inventories remain historically large after years of massive domestic harvests. A record-large harvest this autumn is expected to add to supplies.
"The bottom line is we still have a lot of corn and we have even more wheat," Suderman said.
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