GRAINS-US wheat tumbles on weak exports, down 2 straight months

Sat Dec 1, 2012 3:21am IST

(Updates U.S. market activity to close, adds analyst comment)
    * Wheat notches biggest 2-month slide in a year
    * Corn falls fourth straight month, soy the third month
    * Lack of U.S. export demand weighs on grains

    By Michael Hirtzer
    CHICAGO, Nov 30 (Reuters) - U.S. wheat futures tumbled more
than 2 percent on Friday, concluding their biggest two-month
slide in a year as weak U.S. exports and large deliveries fueled
selling after a run-up in prices earlier in the week.
    End-of-the-month liquidation put added pressure on wheat,
which posted its biggest daily decline in nearly three weeks. 
    Soybeans fell in November for the third straight month and
corn futures had their fourth straight monthly drop as traders
took profits and November came to a close.
    "We're seeing some end-of-the-month liquidation. They
(traders) generally don't like piling on a position into
December that could disrupt year-end profits," said Allendale
Inc analyst Rich Nelson.
    Wheat, soybeans and corn futures each posted modest weekly
gains, with the higher prices earlier this week helping chill
global demand for U.S. supplies.
    "We rallied the market up on anticipation of export demand
and we rallied away from the export price," Charlie Sernatinger,
analyst at ABN Amro in Chicago, said of the wheat.
    Shrinking supplies in the Black Sea region, the cheapest
wheat in the world, were expected to prompt more demand for U.S.
wheat, but the buying has yet to materialize. The world's top
wheat importer Egypt on Friday tendered for wheat for the first
time in a month, with some traders optimistic the U.S. would win
the business. 
    Large wheat deliveries posted on first notice day against
Chicago Board of Trade December wheat futures also
weighed. The CBOT said 2,119 wheat contracts were issued for
delivery, more than double the average trade estimate.
    CBOT December wheat finished 20-1/2 cents lower at $8.65 per
bushel, while most-active March shed 22 cents to
$8.63-1/2, a 2.4 percent drop. 
    Wheat futures had their largest two-month decline in a year
after shedding 4 percent in October and 2 percent in November.
    "Wheat got smoked good and proper as the charts turned down
and the bullspreaders got caught by surprise Chicago
deliveries," Sernatinger added.

    CORN LONGEST STRETCH OF DECLINES IN FOUR YEARS
    Corn futures declined the fourth straight month, losing
ground in each frame since hitting a record high in August of
$8.43-3/4 per bushel. That marks the longest monthly losing
streak since falling five straight months in 2008. 
    The most-active March corn contract finished 6 cents
lower at $7.52-3/4, with losses capped by commercial buying at
the lows, traders said.
    Soybean futures fell the third straight month, the first
such streak since mid-2011, with soy for January delivery 
ending 9-1/4 cents lower at $14.38-3/4.
    "We have some lingering concerns over those export sales
from yesterday," Nelson said. "It also suggests that corn and
bean sales could increase in the coming (weekly export sales)
report."        
    U.S. export sales of soybeans, wheat and corn last week were
the smallest in three weeks, with each missing traders'
expectations, U.S. Agriculture Department (USDA) data showed on
Thursday.  
 
 Prices at 3:14 p.m. CST (2114 GMT)      
                              LAST      NET    PCT     YTD
                                        CHG    CHG     CHG
 CBOT corn                  752.75    -6.00  -0.8%   16.4%
 CBOT soy                  1438.75    -9.25  -0.6%   20.0%
 CBOT meal                  442.40    -0.30  -0.1%   43.0%
 CBOT soyoil                 49.41    -0.36  -0.7%   -5.1%
 CBOT wheat                 863.50   -22.00  -2.5%   32.3%
 CBOT rice                 1527.00    16.00   1.1%    4.6%
 EU wheat                   269.50    -4.25  -1.6%   33.1%
 
 US crude                    88.84     0.77   0.9%  -10.1%
 Dow Jones                  13,026        4   0.0%    6.6%
 Gold                      1715.09    -9.70  -0.6%    9.7%
 Euro/dollar                1.3006   0.0029   0.2%    0.5%
 Dollar Index              80.1340  -0.0700  -0.1%   -0.1%
 Baltic Freight               1086      -11  -1.0%  -37.5%
 
 (Additional reporting by Nigel Hunt in London; editing by Jim
Marshall, Bob Burgdorfer and David Gregorio)
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