Corn traded near a 30-month high in Chicago, heading for a second weekly advance, on increased demand amid tight supply. Wheat and soybeans climbed.
Global corn stockpiles are expected to fall 16 percent to 122.5 million metric tons in the year through August, the U.S. Department of Agriculture said Feb. 9. It also predicted lower Argentine output. U.S. exporters sold 1.1 million tons of the grain in the week ended Feb. 3, up 51 percent from the prior four-week average, the USDA said yesterday.
“USDA corn inventories and Argentina’s latest output forecast were constantly cut on bad weather conditions,” Jonathan Bouchet, an analyst at OTCex Group in Geneva, said in a report today. “The market remains extremely tight.”
Corn for May delivery gained 1 cent, or 0.1 percent, to $7.105 a bushel at 10:33 a.m. London time on the Chicago Board of Trade. The grain is up 4.7 percent this week and yesterday reached $7.15, the highest level for the most-active contract since July 2008.
“Tight supply for corn and better-than-estimated export sales helped boost gains,” Ker Chung Yang, an analyst at Phillip Futures Pte, said by phone from Singapore. Advances in corn have a spillover effect on wheat, he said.
U.S. corn inventories before the harvest are forecast to fall to the lowest in 15 years, Rabobank said in a report. Corn will be the “upside leader” in agricultural commodities, it said.
Wheat for March delivery gained 5 cents, or 0.6 percent, to $8.6775 a bushel, heading for a fourth weekly advance. The grain has added 9.3 percent this year. Milling wheat for March delivery traded on NYSE Liffe in Paris advanced 0.2 percent to 276.50 euros ($373.96) a ton.
Soybeans for March delivery rose 1.5 cents, or 0.1 percent to $14.345 a bushel in Chicago. The oilseed reached $14.5575, the highest price for a most-active contract since July 2008, on Feb. 9.
Rice for March delivery was little changed at $16.165 per 100 pounds. The grain reached $16.335, the highest level since Nov. 5, 2008, on Feb. 9. It may track a rally in wheat prices as consumers seek alternatives, according to Robert Zeigler, director general of the International Rice Research Institute.
“If wheat production falls, people will have to substitute with something in their diet,” Zeigler said in an interview on Bloomberg Television today. “Rice is the easiest one.”
There are no signs of panic buying for now, he said.