Corn fell to a one-week low after the U.S. proposed a cut in the amount of renewable fuels refiners must blend with gasoline next year, reducing demand for crops used to produce biofuels. Soybeans were little changed.
The U.S. Environmental Protection Agency said it would require 15 billion to 15.52 billion gallons of renewable fuels such as corn ethanol and biodiesel in 2014, according to a draft rule released Nov. 15. That compares with 18.15 billion gallons set in 2007 legislation, making it the first time the legal mandate would be cut. U.S. corn output will reach a record 13.989 billion bushels, the U.S. Department of Agriculture says.
The reduced mandate "would mean lower demand for corn, just at the time when the U.S. is harvesting a record corn crop," Carsten Fritsch, an analyst at Commerzbank AG in Frankfurt, said in an e-mailed report.
Corn for March delivery fell 1.1 percent to $4.255 a bushel at 6:59 a.m. on the Chicago Board of Trade, the lowest for the most-active contract since Nov. 8. Futures trading volumes were almost three times the average for the past 100 days for this time of day, according to data compiled by Bloomberg. The grain tumbled 39 percent this year as the USDA forecast a record harvest in the U.S., the world’s top producer.
About 4.9 billion bushels of corn will be used to make ethanol this season, accounting for 35 percent of U.S. output, USDA data show. A final EPA rule is due in the first quarter of 2014, after refiners and ethanol makers weigh in.
Soybeans for January delivery were little changed at $12.80 a bushel. The oilseed, used to make biodiesel, tumbled 2.5 percent on Nov. 15, the biggest drop for a most-active contract in almost seven weeks.
Wheat for March delivery was little changed at $6.5475 a bushel. In Paris, milling wheat for January delivery fell 0.1 percent to 204.25 euros ($275.98) a metric ton on NYSE Liffe.