Chicago Board of Trade (CBOT) corn futures fell to a three-week low on Thursday on worries about weak demand from ethanol makers and crop-boosting rains in South America, traders said. CBOT March corn settled down 6-1/2 cents at $3.75-1/4 per bushel, the lowest since Nov. 30 and the steepest percentage drop in nearly two months.
Rainy weather in dry areas of key exporters Brazil and Argentina are boosting crop production prospects. Concerns about slowing demand for corn from the ethanol industry, which consumes about one-third of the US harvest, weighed on prices. Tumbling energy prices have eroded ethanol production margins.
Traders are watching for signs of demand from China after the country negotiated a 90-day truce in its trade war with the United States which could include Chinese purchases of US corn and other agricultural products. The US Department of Agriculture said corn export sales last week totalled 2.517 million tonnes, within analysts' forecasts for 2.3 million to 2.9 million tonnes.
Additionally, the USDA said private exporters sold 373,455 tonnes of US corn to Mexico for shipment in the 2018/19 season and 53,345 tonnes for shipment in 2019/20.
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