March 25 (Bloomberg) -- Gold led metals higher on speculation declines in the dollar will buoy demand for raw materials at a time of limited supplies. Wheat and other agricultural commodities also rose.

The Reuters/Jeffries CRB Index of 19 futures climbed 1 percent as of 4:07 p.m. London time, with cocoa, wheat, soybeans, corn, silver, coffee and sugar rising more than 2 percent. Commodities are in their seventh year of gains on demand by China and disrupted supplies of metals and crops.

``There is no evidence of anything which has changed on the demand side,'' Hussein Allidina, an analyst in New York at Morgan Stanley, wrote in an e-mail. ``The supply side is still very tight, broadly across commodities.''

Gold for immediate delivery climbed $15.18, or 1.7 percent, to $930.48 an ounce as of 4:09 p.m. in London. The price has dropped 9.9 percent from a record $1,032.70 an ounce last week as the dollar rebounded from an all-time low against the euro. Gold's decline has spurred demand by manufacturers, said Heraeus Ltd.'s precious metals trading manager Dick Poon.

``We're going to see new highs in gold above $1,030 within the next two or three months,'' said Robin Wilkin, London-based head of commodities and currency technical analysis at JPMorgan Chase & Co.

Since commodities trade in dollars, buyers outside the U.S. can purchase more dollar-denominated assets in their own currencies. Copper for delivery in three months climbed $235, or 3 percent, to $8,075 a metric ton as of 4:09 p.m. on the London Metal Exchange. Copper stockpiles monitored by the LME fell 1.4 percent to the lowest in more than seven months.

Lagging Behind Demand

Crude oil was little changed at $100.89 a barrel on the New York Mercantile Exchange, after falling 7 percent the previous three sessions.

Corn and soybeans may keep rising because output is lagging behind demand, said Morgan Stanley, the second-largest U.S. securities firm.

Wheat for May delivery rose 43.25 cents, or 4.2 percent, to $10.6325 a bushel in Chicago. The price has more than doubled in the past year even after a 17 percent decline last week.

The UBS Bloomberg Constant Maturity Commodity Index of 26 commodities gained 33 percent in the past year even after an 8 percent plunge last week.

The price decline last week resulted from a strengthening dollar and reduced inflation expectations, ``rather than a change in the underlying supply and demand fundamentals,'' said Morgan Stanley's Allidina in a separate report e-mailed yesterday.

Fuelling Inflation

Rising prices of food commodities have fueled inflation from the U.S. to China and India. China has increased imports of raw materials and boosted stockpiles to cool prices. South Korea and India announced the removal or reduction of tariffs on some food commodities in the past week to keep inflation in check.

Morgan Stanley raised its price forecasts for corn and soybeans by 20 percent on higher demand for food and ethanol.

Corn for May delivery rose 20 cents, or 3.8 percent, to $5.4475 a bushel on the Chicago Board of Trade. Soybeans rose 50 cents, or 4 percent, to $13.07 a bushel. Corn is up 39 percent in the past year and soybeans 72 percent.

Zinc gained on signs of good demand from processors in China, the world's largest consumer of the metal used to galvanize steel, according to Wang Zheng, an analyst at Fubao Metal Co. in Shanghai.

Zinc for delivery in three months on the LME gained 2.6 percent to $2,328 a metric ton.

To contact the reporters for this story: Glenys Sim in Singapore at gsim4@bloomberg.net; Claudia Carpenter in London at ccarpenter2@bloomberg.net.

Last Updated: March 25, 2008 12:17 EDT