Prices for corn futures plunged by their daily limit on the Chicago Board of Trade Thursday as reports from the U.S. Department of Agriculture showed higher-than-expected stockpiles of corn. Other grain futures also tumbled on the inventories report.
May corn CK3 -5.44% fell by the 40-cent limit for the session, or 5.4%, to a low of $6.95 a bushel. The price limit triggered a trading halt.
Corn stocks on March 1 totaled 5.4 billion bushels, according to the USDA’s Grain Stocks report issued Thursday. That’s down 10% from a year ago.
But the data came as a “big surprise” given average trade estimates of around 5 billion bushels, said Steve Kahler, chief operating officer at Teucrium Trading LLC. “Even though the stocks number is above the highest trade estimate, corn stocks are still 10% below last year’s level on the same report,” Kahler said. “The higher-than-expected stocks are a sign that prices have indeed rationed demand in the export, ethanol and to a lesser degree, the feed sector.”
In a separate report, the USDA said corn growers intend to plant 97.3 million acres of corn in 2013. That would be the most since 1936, according to DTN.