CORN and wheat are set for the biggest monthly gain after the US economy returned to growth, boosting optimism about demand for grains as rain delays harvests in the United States.
Rain and thunderstorms this week will further delay harvests of corn and soybeans and delay planting of wheat, DTN Meteorlogix LLC said in a forecast. The US economy expanded in the third quarter after a yearlong contraction as government incentives spurred consumer spending.
“With the US GDP number, we will probably end up chasing the market again,” Jonathan Barratt, managing director at Commodity Broking Services Pty in Sydney said. “I strapped on my bullish pants today,” he said in an e-mail response to Bloomberg questions.
Corn for December delivery gained as much as 1.1 percent, to $3.835 a bushel in after-hours electronic trading yesterday, extending Thursday’s 2.9-percent jump. The most-active contract was little changed at $3.79 a bushel in late yesterday morning’s trading in Singapore and is set for a 10-percent monthly rise.
About 20 percent of the corn crop has been harvested in the 18 largest US producing states as of Oct. 25. That’s behind last year’s 37 percent and the average of 58 percent in the past five years, according to the US Department of Agriculture.
Wheat for December delivery added as much as 1.1 percent to $5.0925 a bushel in Chicago, and was at $5.0475 in late yesterday morning’s trading in Singapore. It is headed for a 10.3-percent gain in October after four straight monthly declines.
Rice futures, meanwhile, gained for a fourth day yesterday on concern India, the world’s second-largest grower, may become a net importer of the grain for the first time in 21 years in 2010, potentially sparking the kind of panic-buying that pushed prices to a record last year.
Speculation about India’s return to the import market comes as the Philippines, the world’s biggest rice importer, advances rice purchases after storms damaged its crops, widening the Southeast Asian nation’s production shortfall.
Rice for January delivery rallied as much as 1.6 percent to $14.635 per 100 pounds in Chicago, the highest price for the most active contract since Jan. 12. Futures, which reached a record $25.070 in April 2008, are set for a 9.9-percent gain this month.
Prices were also lifted on concern global supply may be smaller than estimated as rain delays harvest in the US, the world’s fourth-biggest exporter. –By Luzi Ann Javier, Bloomberg
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