June 11 (Bloomberg) -- Corn rose for a sixth day to a record in Chicago, leading gains in soybeans, wheat and rice, after the U.S. cut its output estimate by 3.2 percent from a May forecast as cold, wet weather delayed planting and flooded fields.

Output will be 11.735 billion bushels, compared with 12.125 billion forecast on May 9, the U.S. Department of Agriculture said yesterday in a report. The estimate is 10 percent smaller than last year. Inventories in the world's biggest producer may drop to the lowest since 1996 by Aug. 31, 2009, the USDA said.

Corn prices have gained 50 percent this year, heading for a fourth straight annual gain, as demand surged for livestock feed and biofuels. Global inventories are forecast to fall to a 24- year low, the U.S. government said. The price of wheat, rice and soybeans also reached records this year after adverse weather curbed global output, reducing stockpiles amid rising demand.

``No one can stop the corn price's run-up now,'' Hiroyuki Kikukawa, general manager of research at IDO Securities Co., said today from Tokyo. ``Now we have heavy rains in the Midwest and will see a summer heat wave in July and August. We may see the USDA cut further its output estimate next month.''

Corn for July delivery rose as much as 10.5 cents, or 1.6 percent, to $6.8375 a bushel in after-hours trading on the Chicago Board of Trade and stood at $6.83 at 3:51 p.m. Singapore time. The new crop December contract climbed as high as to $7.12 after closing above $7 yesterday for the first time.

Shrinking Stockpiles

Estimated U.S. inventories of 673 million bushels before the 2009 harvest, down 53 percent from a year earlier, would represent 5.4 percent of expected annual consumption, or 20 days of use. That's down from 40 days estimated this year and the lowest since 1996 when reserves were projected to last 18 days.

The government cut its yield forecast for corn by 3.2 percent to 148.9 bushels an acre, from 153.9 predicted last month and 151.1 for last year's crop. The reduction reflects ``persistent heavy rainfall across the Corn Belt,'' the USDA said. The crop will be harvested by November.

Corn's yield potential falls unless plants have emerged from the ground before the end of May in most of the Midwest. Corn planted in wet, cool soils develops shallow roots, increasing the threat of damage from hot, dry weather in July and August.

About 60 percent of the corn crop in the U.S., the largest exporter of the grain, was in good or excellent condition as of June 8, down from 63 percent a week earlier, and 77 percent a year earlier, the USDA said June 9 in a report. An estimated 89 percent of the corn crop had emerged from the ground as of June 8, compared with 98 percent a year ago and the five-year average of 89 percent, the USDA said.

Soybeans Gain

Rainfall across the Midwest was as much as four times normal during the past 60 days, National Weather Service data showed. Midwest fields had as much as 12 inches (30 centimeters) of rain in the past week, it showed. Some areas may get another five inches in the next four days, increasing flooding and reducing the soil's nitrogen content, which may limit plant growth.

Soybeans for July delivery added as much as 21 cents, or 1.5 percent, to $14.675 a bushel, and last traded at $14.6625. The contract rose 7.4 percent this month, on track for the third straight monthly gain. Soybeans touched a record $15.865 on March 3 on increased demand for animal feed and vegetable oils made from the oilseed.

Soybean inventories on Aug. 31 are expected to be 125 million bushels, down from last month's forecast of 145 million and a record 574 million last year, the USDA said. Reserves on Aug. 31, 2009, are expected to be 175 million bushels, down from 185 million forecast last month even with the USDA predicting a 20 percent jump in U.S. production.

China's soybean imports, the world's largest, rose 20 percent to 13.7 million metric tons in the first five months of the year, the customs office said today, citing preliminary data.

Wheat for Feed

Wheat for July delivery was up 8.5 cents, or 1.1 percent, at $8.175 a bushel at 3:52 p.m. Singapore time after gaining 2.6 percent yesterday on speculation that record corn prices may force livestock producers to use more feed wheat.

Still, wheat futures are down 39 percent from a record $13.495 on Feb. 27 as farmers increased seeding of the grain.

``Movements in the corn market are likely to have a growing influence on wheat prices over the second half of 2008,'' Rabobank Group said today in a report. ``At current price levels soft red winter wheat is looking increasingly attractive as a substitute for corn in the U.S. and European feed ration.''

Grain production in Western Australia state, the nation's largest wheat grower, may be less than previously forecast because of dry weather, CBH Group said today.

Western Australia

Output of all grains may be between 8 million tons and 12 million tons, said Michael Musgrave, operations manager for Perth-based CBH, the state's largest grain handler and marketer. That compares with the company's previous forecast of 12 million tons to 16 million tons, he said. The revised forecast compares with the 10 million ton to 12 million ton estimate made last week by the state's Department of Agriculture and Food.

Rice for July delivery rose 23 cents, or 1.2 percent, to $19.65 per 100 pounds at 3:06 p.m. Singapore time after dropping by the daily limit of 50 cents yesterday. Rice is up 82 percent from a year earlier, reaching a record $25.07 on April 24, after some exporters curbed exports to ensure local supplies.

To contact the reporter on this story: Jae Hur in Singapore at jhur1@bloomberg.net

Last Updated: June 11, 2008 03:58 EDT