November 30th, 2011

Corn futures fell in Chicago, extending a monthly decline, as Morgan Stanley forecast pressure on prices next year from higher South American exports of the grain.

U.S. corn shipments, the world’s largest, may slump 21 percent in the 2011-12 season to 1.45 billion bushels, the least since 1985-86, according to Morgan Stanley. That’s smaller than a Nov. 9 forecast of 1.6 billion bushels by the U.S. Department of Agriculture.

“Corn prices will likely come under pressure in the second half of the year as rebounding production in South America, and ultimately the U.S., increases supply,” analysts led by Hussein Allidina wrote in the report e-mailed today, referring to 2012.

Corn futures for March-delivery dropped 1 percent to $5.995 a bushel on the Chicago Board of Trade by 12:58 p.m. Paris time. Prices are down 7.3 percent this month.

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