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Corn Futures: Corn Advances to 14-Month High on U.S. Crop Demand; Wheat, Soybeans Climb
 August 30th, 2010
Corn futures climbed to a 14-month high on speculation the U.S., the top producer and exporter, may miss a record harvest and as growing areas in China face floods. Corn in Dalian gained to the highest level since at least 2004.
Corn futures for December-delivery rallied as much as 2 percent to $4.4475 a bushel, the highest price for the most-active contract in Chicago since June 15, 2009. The month traded at $4.4225 a bushel at 5:59 p.m. Singapore time. May-delivery corn in Dalian rose 0.5 percent to 2,038 yuan ($300) per metric ton.
The Midwest, the largest producing region in the U.S., will be drier than normal in the 10 days from Aug. 27, according to Accuweather.com. Provinces in China from Heilongjiang to Liaoning will have as much as 1.25 inches of rain, and some areas will have heavier showers, renewing flooding problems, it said in a separate report.
“Weather concerns in parts of the U.S., Argentina and Asia supported prices, along with export demand for U.S. corn,” Commonwealth Bank of Australia said in a report e-mailed today.
Twenty-one of 32 traders and analysts surveyed from Chicago to Tokyo on Aug. 27 said corn will climb this week and 20 out of 33 predicted soybeans will rally on speculation dry weather will reduce U.S. crop yields.
Corn production in the U.S. will reach 13.365 billion bushels, 1.9 percent more than the record crop in 2009, the U.S. Department of Agriculture said in an Aug. 12 report. A record soybean harvest of 3.433 billion bushels was forecast by the department, up 2.2 percent from last year.
Drought, freezing weather and floods have “negatively impacted” China’s grain harvests, state-run Xinhua News Agency reported Aug. 27, citing Vice Agriculture Minister Chen Xiaohua.
Corn Futures Net LongHedge-fund managers and other large speculators increased their net-long position in Chicago corn futures by 10,740 contracts in the week ended Aug. 24, 3 percent more than a week earlier, according to U.S. Commodity Futures Trading Commission data. Net-long positions are the difference between bets on price gains and price declines.
Corn futures speculative long positions, or bets prices will rise, outnumbered short positions by 357,975 contracts on the Chicago Board of Trade, the Washington-based commission said in its Commitments of Traders report.
Soybeans for November delivery added 0.4 percent to $10.30 bushel. Wheat for December delivery jumped as much as 2.8 percent to $7.1475 a bushel before trading at $7.1050.
Net-long positions in wheat rose by 3,300 contracts, or 10 percent, to 36,743 contracts in the week ended Aug. 24, according to the commission’s report. Speculative long positions in soybeans outnumbered short positions by 139,374 contracts, according to the commission. Net-long positions rose by 3,580 contracts, or 2.6 percent, from a week earlier.
Corn Russian ImportsRussia’s imports of grains may rise 400,000 tons to 2.44 million tons in the 2010-2011 season after drought slashed production, the USDA’s Foreign Agricultural Service said in an Aug. 23 report. The forecast includes purchases of 1.1 million tons of wheat and 400,000 tons of corn.
“We think Russia’s grain imports are likely to be more than 3 million tons,” Chung Yang Ker, an analyst at Phillip Futures Pte., said in a note to investors today. “The withering grain crop prompted speculation that Russia may be forced to import a large volume of grain for the first time in a decade.”
Milling wheat for November delivery rose 2.4 percent to 225.75 euros ($287.13) a ton on NYSE Liffe in Paris at 12:03 p.m. local time.
- Luzi Ann Javier in Singapore at Bloomberg.
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