Corn futures rose to a four-week high and soybeans gained after a government report showed demand for livestock feed eroded U.S. inventories. Wheat advanced.
Corn stockpiles before the next harvest will fall to 632 million bushels, the lowest since 1996, the U.S. Department of Agriculture said on March 8. The agency raised its forecast for use of the grain in animal feed by 2.2 percent to 4.55 million bushels. Soybean inventory may drop to the lowest since 2004.
“We have not slowed consumption for either corn or soybeans,” Jim Gerlach, the president of A/C Trading Co. in Fowler, Indiana, said in a telephone interview. “The USDA report will keep prices high to ration tight supplies.”
Corn futures for delivery in May gained 1.1 percent to close at $7.1125 a bushel at 2 p.m. on the Chicago Board of Trade. Earlier, the price reached $7.1625, the highest for a most-active contract since Feb. 8.
Soybean futures for May delivery rose 0.6 percent to $14.795 a bushel, the highest settlement since Feb. 7.
Corn rose to a record in August, and soybeans jumped to an all-time high in September after the most-severe drought since the 1930s damaged crops. The grain and oilseed premiums for May futures increased versus prices in the fourth quarter as rain boosted prospects for summer crops.
Weekend precipitation helped to reduce soil-moisture deficits in the western Midwest, while rain in Argentina and Brazil in the past two days may boost yields, Gerlach said.
As much as 1.5 inches (3.8 centimeters) of rain fell from Nebraska to Indiana, easing concern that drought will spread for the second straight year, Gail Martell, the president of Martell Crop Projections in Whitefish Bay, Wisconsin, said in a report.
Wheat futures for May delivery gained 0.4 percent to $7 a bushel, the third straight gain.
Corn is the biggest U.S. crop, followed by soybeans, hay and wheat, USDA data show.