Nov. 18 (Bloomberg) -- Corn rose to the highest price since June and soybeans rallied to a three-month high as a decline in the dollar increased the appeal of commodities as a hedge against inflation.

The dollar dropped against 13 of the 16 major currencies as Federal Reserve Bank of St. Louis President James Bullard said policy makers may not start to raise U.S. interest rates until early 2012. Gold climbed to a record. Before today, corn gained 2.6 percent this year and soybeans rose 5.1 percent compared with a 77 percent jump in crude oil.

“The weaker dollar is the driving force,” said Mark Schultz, a vice president for Northstar Commodity Investments LLC in Minneapolis. “The rapid flow of speculative buying is overwhelming the markets and catching end-users short,” because some expected prices to fall during the U.S. harvest, he said.

Corn futures for March delivery rose 6.25 cents, or 1.5 percent, to $4.2375 a bushel at 10 a.m. on the Chicago Board of Trade, after earlier touching $4.25, the highest since June 19. Before today, the most-active contract was up 38 percent since reaching a three-year low of $3.02 on Sept. 8.

Soybean futures for January delivery rose 15.5 cents, or 1.5 percent, to $10.45 a bushel in Chicago, after earlier touching $10.49, the highest since Aug. 13.

The number of open corn contracts in Chicago rose by 14,732 to 1,050,331 yesterday on the CBOT, the largest total since September 2008, data from the exchange show. Soybean open interest rose 12,587 to 440,294 contracts, the highest since Oct. 28.

Corn is the biggest U.S. crop, valued at $47.4 billion in 2008, with soybeans in second place at a record $27.4 billion, government figures show.

To contact the reporter on this story: Jeff Wilson in Chicago at jwilson29@bloomberg.net

Last Updated: November 18, 2009 11:02 EST