Oct. 30 (Bloomberg) -- Wheat fell to a four-week low on speculation that India, the world’s second-largest grower, will boost exports, reducing demand for grain from other suppliers. Soybeans rose, while corn dropped.
The Indian government approved a cut in the minimum price to $260 a metric ton from $300 to reduce state reserves that are more than double normal needs. State stockpiles totaled 36.1 million tons at the start of this month compared with a usual requirement of 14 million tons, according to Food Corp. of India. The government buys about 30 percent of rice and wheat production from farmers at prices set by the state.
“India is cutting prices to grab market share,” Shawn McCambridge, the senior grain analyst for Jefferies Bache LLC in Chicago, said in a telephone interview. “The government would rather sell the grain then let it rot in inadequate storage facilities.”
Wheat futures for delivery in December fell 0.9 percent to close at $6.75 a bushel at 1:15 p.m. on the Chicago Board of Trade, after dropping to $6.74, the lowest since Oct. 1. The most-active contract fell 13 percent this year as world production is forecast to rise 8.2 percent to a record.
Soybeans rose for a second day in Chicago as demand for U.S. exports increased and palm oil touched an eight-month high on concern production in Malaysia will decline.
U.S. exporters shipped 83.6 million bushels of soybeans in the week to Oct. 24, the second-most ever, the U.S. Department of Agriculture said Oct. 28. Palm oil, an alternative to soybean oil used in foods and fuel, climbed to the highest since February in Kuala Lumpur as rain may disrupt output.
Soybean futures for delivery in January added 0.5 percent to $12.765, capping the first two-day gain since Oct. 17.
Corn futures for delivery in December declined 0.4 percent to $4.3025 a bushel. Yesterday, the most-active contract touched $4.2825, the lowest since August 2010. U.S. production this year may jump 30 percent to a record 14 billion bushels from a year earlier, Archer-Daniels-Midland Co, the grain processor, said yesterday in a conference call with analysts.
--With assistance from Pratik Parija and Prabhudatta Mishra in New Delhi. Editors: Millie Munshi, Thomas Galatola