Corn, Soybeans Rise as Reduced World Crops Boost U.S. Exports
06.09.2010 13:19 "Agro Perspectiva" (Kyiv) —
Corn prices touched a 14-month high and soybeans rose after adverse weather damaged crops in Russia, Europe and Canada, boosting demand for U.S. supplies to make animal feed, food and fuel.
U.S. exporters have sold 10.616 million metric tons of corn for delivery after Sept. 1, up 36 percent from the same time a year earlier, the Department of Agriculture said today. Soybean sales reached 15.315 million tons as of Aug. 26, up 8.7 percent from a year earlier. Egypt bought 120,000 tons of corn and 100,000 tons of soybeans overnight, the USDA said today in a separate report.
«Export demand continues to be very good,» said Mark Schultz, the chief analyst for Northstar Commodity Investment Co. in Minneapolis. The «U.S. is going to continue to pick up extra demand» after world production was reduced in exporting nations, Schultz said.
Corn futures for December delivery rose 0.75 cent, or 0.2 percent, to close at $4.475 a bushel at 1:15 p.m. on the Chicago Board of Trade. Earlier, the price touched $4.48, the highest level since June 2009. The contract erased earlier losses of as much as 0.8 percent.
The commodity rose 8 percent in August as Russia halted grain exports to protect domestic supplies.
Soybean futures for November delivery rose 3.5 cents, or 0.3 percent, to $10.09 a bushel in Chicago, rebounding from an earlier decline. Last month, the most-active futures rose 0.5 percent and reached a seven-month high of $10.49 on Aug. 5.
Grain prices also rose after Russia said it would extend its ban on grain exports until the harvests in November 2011, increasing demand for alternative supplies. The announcement by Russian Prime Minister Vladimir Putin came as a surprise, because Russia originally had banned exports through the end of this year, said Tim Hannagan, a grain analyst for PFG Best Inc. in Chicago.
Russians have responded to slashed harvest forecasts by hoarding staples, which has contributed to price gouging, a government official said.
The ban by Russia, which tied last year with Canada as the world’s second-largest wheat exporter, began Aug. 15. Lower quality Russian wheat competes with corn and other grains in livestock feed.
«The U. S. is the grocery store to the world,» Hannagan said. «Export demand is unlikely to slow.»
Corn is the biggest U.S. crop, valued at $48.6 billion in 2009, government figures show, followed by soybeans at $31.8 billion.
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