Corn futures rise to highest in more than two months
Thursday, 13 May 2010
NEW YORK, May 12 (Bloomberg): Corn futures rose to the highest in more than two months on speculation that China will boost imports of the US grain, helping drain excess global supply.
Corn for July delivery gained as much as 1.2 per cent to $3.815 a bushel on the Chicago Board of Trade, the highest for the most-active contract since March 5. It traded at $3.805 a bushel at 4:55 p.m. Singapore time.
China's state-owned Cofco Ltd. bought 300,000 metric tons of US corn from an international trading house, two traders with knowledge of the matter said. The purchase, if delivered, will make China a net importer for the first time since the 1995-1996 season. The country was forecast to export 150,000 tons of the grain this year by the US Department of Agriculture.
Traders "are getting nervous and taking their shorts off," said Ben Barber, a futures adviser at Bell Commodities Ltd. in Melbourne, referring to bets that prices will decline. "There is a risk that China may become a big net importer, then obviously demand is going to push up prices."
Cofco's purchase adds to the 115,000 tons US exporters sold to China, announced by the USDA on April 28. That will take total purchases by the world's second-largest consumer to 415,000 tons, exceeding the USDA's estimate for China's imports of 300,000 tons yesterday.
China may buy as much as 500,000 tons this year after drought and frost damaged the nation's crops and as sales from state stockpiles drained domestic supply, Jay O'Neil, an agricultural economist at the International Grains Program at Kansas State University, said in an April 29 interview.
The USDA yesterday estimated corn stockpiles in the US, the world's largest grower and exporter, will be 1.74 billion bushels by Aug. 31, down from a forecast a month earlier of 1.9 billion bushels, as higher exports offset lower domestic feed grains demand.
Corn for July delivery gained as much as 1.2 per cent to $3.815 a bushel on the Chicago Board of Trade, the highest for the most-active contract since March 5. It traded at $3.805 a bushel at 4:55 p.m. Singapore time.
China's state-owned Cofco Ltd. bought 300,000 metric tons of US corn from an international trading house, two traders with knowledge of the matter said. The purchase, if delivered, will make China a net importer for the first time since the 1995-1996 season. The country was forecast to export 150,000 tons of the grain this year by the US Department of Agriculture.
Traders "are getting nervous and taking their shorts off," said Ben Barber, a futures adviser at Bell Commodities Ltd. in Melbourne, referring to bets that prices will decline. "There is a risk that China may become a big net importer, then obviously demand is going to push up prices."
Cofco's purchase adds to the 115,000 tons US exporters sold to China, announced by the USDA on April 28. That will take total purchases by the world's second-largest consumer to 415,000 tons, exceeding the USDA's estimate for China's imports of 300,000 tons yesterday.
China may buy as much as 500,000 tons this year after drought and frost damaged the nation's crops and as sales from state stockpiles drained domestic supply, Jay O'Neil, an agricultural economist at the International Grains Program at Kansas State University, said in an April 29 interview.
The USDA yesterday estimated corn stockpiles in the US, the world's largest grower and exporter, will be 1.74 billion bushels by Aug. 31, down from a forecast a month earlier of 1.9 billion bushels, as higher exports offset lower domestic feed grains demand.