GRAINS-Corn hits 2-week high on short-covering ahead of USDA
(Updates U.S. market activity to close)
By Michael Hirtzer
CHICAGO, Sept 8 (Reuters) - U.S. corn futures climbed more than 1 percent to a two-week high on Thursday as investors exited short positions ahead of the U.S. Department of Agriculture's monthly crop report due on Monday, when the government is expected to trim corn yields.
Soybean futures reversed from small losses and turned higher late in the session at the Chicago Board of Trade, while U.S. wheat futures gained in light-volume trading.
USDA in its September supply and demand outlook is likely to reduce the average corn yield to 173.4 bushels per acre, down from 175.1 bpa on Aug. 12 but still a record high, according to a Reuters analyst poll.
Analysts predicted USDA would boost U.S. soybean yields to a record of 49.2 bpa, up from 48.9 bpa in August.
U.S. Energy Information Administration data released at mid-morning on Wednesday showing sharply lower production of corn-based ethanol and decreased stocks of the biofuel was seen as bullish for ethanol prices but slightly bearish for corn.
CBOT December corn settled 5-1/4 cents higher at $3.38-1/2 per bushel, highest since Aug. 24.
"There's a little short-covering in the corn market but the ethanol data capped any price gains. It was unexpected to see that drop (in ethanol output)," said Futures International analyst Terry Reilly. Continuación...