July 1, 2011 / 2:03 AM / 8 years ago

CORRECTED-GRAINS-U.S. corn, wheat continue plunge on higher stocks

 (Corrects second paragraph to show 10 pct price fall over two
 * Lower corn prices may see less demand for Australian wheat
 * High corn prices seen as key to larger U.S. stockpiles
 SYDNEY, July 1 (Reuters) - U.S. corn and wheat futures
continued to tumble on Friday after a U.S. government report
pointed to much higher-than-expected corn supplies from the
world's largest exporter of the grain.	
 Chicago Board of Trade corn for December delivery , the
harvest month contract dropped 4.75 percent to $5.91 per bushel,
early Asian trade on Friday, extending  the
contract's two-day fall to nearly  10
percent  , and hitting its lowest level since
 Corn tumbled after the U.S. Department of Agriculture (USDA)
significantly raised crop prospects and stock levels, shocking
market with a forecast for a potentially record-large corn crop
despite an excessively wet spring. 	
 Rabobank said the USDA report did not improve clarity and
could make for choppy trade.	
 "In our view, there remains a lot of confusion over final
plantings due to the widespread flooding this season, which
significantly delayed plantings and created a lot of uncertainty
around the survey period," the bank said in a market report.	
 Corn prices hit a record near $8.00 per bushel last month,
leading to a pull-back in demand as livestock feed importing
countries such as China switched to wheat.	
 Tumbling corn prices also pulled wheat lower and the
December contract initially fell over 2 percent before
recovering to trade broadly flat by mid-morning.	
 Australia's feed wheat supplies to countries such China and
Vietnam benefited from rising corn prices as much of the
country's 2010/11 crop was downgraded to feed wheat quality
following a wet harvest.	
 Australia's is the world's fourth largest wheat exporter and
a dominant player in the Asian market.	
 "There's a lot of day to day noise so the actual outcome is
hard to predict," said David Creed, an agricultural economist at
National Australia Bank (NAB).	
 He added that Australia's feed wheat sales in the Asian
region were likely to suffer tough competition if corn prices
remained lower.	
 The USDA said it planned to re-survey farmers in the states
of Minnesota, Montana, North Dakota and South Dakota on Aug. 11
which may provide a clearer picture of actual planted acreage.	
 Grains prices at  0134 GMT                    	
 Contract  Last    Change  Pct chg  Two-day chg MA 30   RSI 	
 CBOT wheat 609.00  -5.25   -0.85%   -9.68%     739.99   20    	
 CBOT corn  591.00  -29.50  -4.75%   -9.15%     696.26   26    	
 CBOT soy  1305.75   11.75  +0.91%   -1.30%    1350.90   37	
 CBOT rice $15.04    $0.19  +1.31%   +4.84%     $15.27   57    	
 WTI crude  $94.80  -$0.62  -0.65%    0.03%     $96.69   53    	
Euro/dlr       $1.449  -$0.002  -0.12%    +0.37%         USD/AUD
     1.069   -0.003   -0.26%    +0.09%         Most active
Wheat, corn and soy US cents/bushel.	
Rice: USD per hundredweight    	
RSI 14, exponential	
 (Reporting by Bruce Hextall; Editing by Balazs Koranyi)	
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