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Grains - Wheat, corn trade near 6-month lows in final day of year

Published 12/31/2012, 05:48 AM
Investing.com - U.S. grain futures were broadly lower in holiday-thinned trade during European morning hours on Monday, with wheat and corn prices hovering near the lowest level since July amid concerns over a slowdown in demand for U.S. supplies.

Trading volumes are expected to remain light, with many markets closed for the New Year’s holiday and as market players continued to eye talks surrounding the U.S. “fiscal cliff” crisis.

On the Chicago Mercantile Exchange, wheat for March delivery traded at USD7.6988 a bushel, down 1.1% on the day.

The March contract fell by as much as 1.2% earlier in the session to hit a daily low of USD7.6788 a bushel. Wheat futures touched USD7.6462 a bushel last Thursday, the weakest level since July 3.

For the year, U.S. wheat futures rallied 18.5%, making it one of the best-performing commodities of 2012, as concerns over tightening supplies from major wheat exporters Russia and Australia boosted sentiment on the grain.

Prices have been on a downward trend in recent months however, losing almost 14% since September, amid easing concerns over a disruption to global supplies.

Meanwhile, corn futures for March delivery traded at USD6.8950 a bushel, down 0.6% on the day. The March contract declined by as much as 0.65% earlier in the day to hit a session low of USD6.8938 a bushel.

The March CBOT corn contract touched a five-and-a-half month low of USD6.8762 a bushel on December 20, as a bout of technical selling set in after prices broke below the key psychological USD7.00-per-bushel level.

Despite recent losses, corn is on track for a more than 7% advance in 2012, a fourth straight year of gains, after a furious rally in the first half of the year took prices to a record high of USD8.4237 a bushel in August.

Elsewhere, soybeans futures for March delivery traded at USD14.0225 a bushel, down 1.1% on the day. The March contract slumped by as much as 1.2% earlier to hit a daily low of USD14.0188 a bushel.

CBOT-traded soy futures climbed almost 17% on the year, as escalating concerns over the impact of the worst drought in at least 56 years in the U.S. Midwest and Great Plains-region drove prices to an all-time high of USD17.8888 a bushel in August.

Corn is the biggest U.S. crop, followed by soybeans, government figures show. Wheat was fourth, behind hay.

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