Chicago corn futures slumped on Wednesday, giving up part of their previous session's gains, as the US government reported the US ethanol industry saw a near-decade low in weekly production amid massive stocks.
Wheat futures followed in mid-day trading, as investors squared up their positions ahead of Thursday's World Agriculture Supply and Demand Estimates (WASDE) Report from the US Department of Agriculture.
The most-active corn futures contract on the Chicago Board of Trade was down 1-1/2 cents at $3.29-3/4 a bushel by 11:50 a.m. (1650 GMT).
CBOT soyabean futures ticked up 1/2 cent to $8.55-1/4 a bushel, while wheat futures fell 1 cent to $5.48-1/4 a bushel.
The market has mostly factored in strong US wheat production, said traders, after the USDA reported better-than-expected crop conditions on Monday, rating 62% of the crop as good-to-excellent. The report beat analyst expectations that only 56% of winter wheat would achieve the rating.
The big mover of the day was corn - and the pain that the coronavirus panic is causing the ethanol sector, a significant market for US corn.
A slew of US ethanol plants have shut down as fuel demand has collapsed due to the coronavirus outbreak, and meatpackers have been hit by a worrying side-effect: less carbon dioxide is now available to chill beef, poultry and pork.
Some traders are also questioning China's appetite for US soyabeans.
China released 500,000 tons of soyabeans from state reserves on Tuesday, as rain delays slowed shipments from Brazil. That is despite a Phase 1 trade deal between China and the US, that promised a slew of US agricultural exports, including soyabeans.
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