US Soy and Grain Review

CHICAGO (Dow Jones)--A shift in sentiment about Europe's debt crisis and weak
demand sent U.S. grain and soybean futures lower Monday.
  The agricultural commodities had posted early gains Monday, but the rally
fizzled as Europe's problems pushed the euro sharply lower versus the U.S.
dollar.
  Corn for December delivery at the Chicago Board of Trade ended down 6 1/4
cents, or 1.1%, at $5.80 1/4. The market had climbed as high as $5.92 in early
trade.
  Soybean futures also retreated, with disappointing weekly export inspections
adding to the pressure. CBOT January soybeans closed down 9 1/2 cents at $11.26
1/4 a bushel, down 20 cents from the day's highs.
  A drop in the euro during the session helped drive commodity prices lower,
serving as a reminder that the optimism about Europe ahead of a Friday debt
summit was purely speculative.
  "We only have hopes going into the summit," said Rich Nelson, an analyst with
Allendale. "We don't have facts yet."
  Traders added that early gains had more to do with short-covering than any
shift in supply and demand fundamentals, which are considered weak due to poor
exports. Along with soybean exports, wheat export inspections Monday were also
weak, traders said.
  Corn export inspections were slightly better than expected, but traders said
the outlook for exports generally was dim for corn and wheat, thanks in part to
a flood of cheaper, feed-quality wheat from the Black Sea region and Australia.

  Traders said the market lacks any fundamentals news, and they are looking
ahead to Friday's supply and demand report from the U.S. Department of
Agriculture.
  "At this point we're floating around and waiting until Friday," said Jerry
Gidel of North America Risk Management Services.
  Many traders are expecting the government to increase its stockpile estimates
due to weak demand.
  Losses Monday were limited in soybeans by uncertainty about the South American
crop, which need ample rains to ensure strong yields. In wheat, worries about
crops in the Ukraine and the U.S. southern Plains are limiting losses.
  CBOT December wheat ended down 13 1/2 cents at $5.98 3/4 a bushel. Kansas City
Board of Trade wheat closed down 9 1/2 cents at $6.66 1/2, and Minneapolis Grain
Exchange wheat ended down 7 3/4 cents at $8.48 1/4.
  Analysts said the grains markets will remain vulnerable to shifts in sentiment
on Europe's debt crisis, which will prompt caution as traders are wary of being
on the wrong side of global events they can't predict.
  Meanwhile, soybean meal ended lower, with the December contract settling down
$5.30 at $281.10 a short ton. December soybean oil held steady amid flat crude
oil prices, ending up 0.02 cents at 50.07 cents a pound.
  U.S. rice futures ended slightly lower amid lackluster demand. Poor demand
sent the market down sharply all autumn, but prices have rebounded recently,
building ideas that a market bottom is in place. World supplies are considered
ample. CBOT January rice ended down 7 cents at $14.38 1/2 per hundredweight,
down 3% since Wednesday.
  U.S. ethanol futures were mixed, as the market avoided a selloff in many other
commodities thanks to stable crude oil prices. December CBOT ethanol ended down
0.003 cents at $2.50 a gallon. Some deferred contracts were slightly higher.
  CBOT oats ended mostly lower. Oats for March delivery ended down 7 3/4 cents
at $3.07 1/4.