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Agricultural futures prices slumped in September. Weakness was aggravated by last week’s buckling in equity prices, but the decline was well under way in advance of the latest sell-off on the world’s stock exchanges. By the close of trading on Thursday, Sept. 22, December wheat futures were down $1.71 a bu in Kansas City, $1.63 in Chicago and $1.17 in Minneapolis compared with their respective closes on Aug. 26. The December corn future has dropped about $1.10 a bu, or 15%, thus far in September, and the November soybean contract has dropped about $1.84 a bu, or about 13%.

Slumping agricultural futures prices coincided with and were related to a month-long rally in the U.S. dollar index, which last week traded to the highest levels since February 2011.

The International Grains Council in its Sept. 22 Grain Market Report noted its daily Grains and Oilseeds Index has retreated 9% from an end-of-August peak to 274. The I.G.C. index was at its lowest level since July 4. The I.G.C. commented, “Markets were mostly responding to global financial developments, including the U.S. dollar’s renewed strength, especially against the euro.” The I.G.C. said underlying seasonal patterns also were discernible, and sizable grain shipments from Russia and other Black Sea origins further contributed to a bearish market tone.

The I.G.C. projected 2011-12 world wheat ending stocks at 193 million tonnes, up 2 million tonnes from its August forecast and equal to the 2010-11 carryover. The I.G.C. projected world wheat production in 2011-12 at 679 million tonnes, up 2 million from August and up 28 million tonnes, or 4%, from 651 million tonnes in 2010-11. World wheat consumption in 2011-12 was projected at a record 679 million tonnes, up 1 million tonnes from the August forecast and up 23 million tonnes from 2010-11 disappearance at 656 million tonnes. World wheat trade in 2011-12 was projected at 128 million tonnes, unchanged from August and up 1 million tonnes from 2010-11.

The I.G.C. raised its forecast for 2011-12 corn ending stocks to 119 million tonnes, up 1 million tonnes from its August forecast but down 8 million tonnes from the projected 127 million tonnes in 2010-11.