Nov. 18 (Bloomberg) -- Agricultural commodities such as corn and soybeans are likely to outperform oil and metals next year as supply constraints and high costs compensate for falling demand amid the global economic recession, JPMorgan Chase & Co. said.

``Agricultural commodities are best placed to outperform,'' JPMorgan analyst Lawrence Eagles said in a research note. ``Funding issues, high fertilizer costs and low stocks create yield and planting risks while weather is an ever-present variable.''

The worst financial crisis since the 1930s has caused commodities prices to slump from records reached earlier this year as demand shrinks. While products such as corn and soybeans have not been spared, the outlook for prices remains more robust amid the slowdown, according to the JPMorgan note, dated yesterday.

``In agriculture, not only is there less sensitivity of demand to economic pressures, but there may be other constraints that limit yield growth,'' it said.

The bank forecasts corn prices to decline 7 percent next year to $4.98 a bushel, compared with $5.35 a bushel in 2008. In contrast, it expects oil prices will slide 32 percent to $69 a barrel next year and copper by 39 percent to $4,263 a ton.

To contact the reporter on this story: Alexander Kwiatkowski in London at akwiatkowsk2@bloomberg.net

Last Updated: November 18, 2008 11:19 EST