A report from the U.S. Agriculture Department saying corn supplies for September will be higher than originally thought sent the share price of fertilizer companies Potash Corp. (NYSE:POT), Mosaic (NYSE:MOS) and Agrium (NYSE:AGU) down.
Wednesday trades on the Chicago Board of Trade had corn for July delivery — the most active contract — falling 30 cents to $6.77 a bushel, a 4 percent drop.
Other grains were also down Wednesday, with wheat for July delivery losing 40 cents, or 5 percent, to $7.58 a bushel. Soybeans for July delivery dropped 9 cents to $13.28.
For the 2010-2011 marketing year ending Aug. 31, the USDA projected corn ending stocks at 730 million bushels, up from its April 8 estimate of 675 million bushels.
For August 2012, U.S. corn stocks are expected to come in at 900 million bushels, more than what agricultural forecasters had been looking for.
According to the USDA, there will be 92.2 million acres of corn planted, up from 88.2 million acres in 2010.
This could end up giving some food and meet companies like Kraft Foods (NYSE:KFT), Sara Lee (NYSE:SLE), Tyson Foods (NYSE:TSN) and Smithfield Foods (NYSE:SFD) a break, as they've had to raise food prices in response to higher input costs.
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