Corn Heads for Biggest Weekly Advance in Almost Four Months; Soybeans Gain

Corn advanced, heading for the biggest weekly gain in almost four months, on speculation the U.S. may cut its crop estimates after floods and hot weather damaged plants. Rice was poised for the longest winning streak in almost three years. 

December-delivery corn rose as much as 0.5 percent to $5.005 a bushel in Chicago and traded at $5.0175 at 11:49 a.m. Tokyo time. The grain has jumped 7.7 percent this week, the biggest such gain since the week ended June 11.

“Corn was supported by market forecast of a decline in the U.S. crop yields and output,” Toshimitsu Kawanabe, an analyst at Tokyo-based commodity broker Central Shoji Co., said today. The market was also underpinned by Brazil’s lower export forecast and Ukraine’s curb on grain exports, he said.

U.S. production may fall to 12.977 billion bushels from a record 13.11 billion last year, according to a Bloomberg News survey. Yields may drop 5 percent to 156.6 bushels this year, more than the 2.7 percent drop forecast in the survey, according to Farmers National Co., the largest manager of crop land.

The U.S. Department of Agriculture will update its estimates today.

Corn exports by Brazil, the world’s third-largest shipper, may fall next year to 8 million tons from an estimated 9.5 million tons this year because of a smaller harvest, Silvio Porto, a director at the Agriculture Ministry’s crop-forecasting agency, said yesterday.

Ukraine Quotas

Ukraine set quotas on shipments of all grains to ensure food security and cap domestic prices, First Deputy Prime Minister Andriy Klyuev said yesterday. The restrictions may run through the end of this year, he said. Corn exports will be limited to 2 million metric tons and wheat and barley to 500,000 tons each, he said.

The quotas may boost demand for U.S. corn, Jonathan Bouchet, an analyst and trader at OTCex Group in Geneva, said yesterday. The country is the world’s largest barley exporter and fourth- biggest corn supplier, according to the USDA data.

Rough rice for November delivery fell 0.4 percent to $12.75 per 100 pounds after climbing as high as $12.88 yesterday, the highest price since April 26. The contract has advanced 3.3 percent this week, gaining for the seventh straight week. That would be the longest winning streak since Nov. 23, 2007.

Soybeans for November delivery gained 1.4 percent to $10.7975 a bushel. Wheat for December delivery advanced 0.7 percent to $6.64 a bushel. The grain has risen 1.4 percent this week, the first weekly gain in three.

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

 

To contact the editor responsible for this story: James Poole at jpoole4@bloomberg.net