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Corn, soybean up on inclement weather worries

By Luzi Ann Javier | China Daily | Updated: 2010-09-28 07:55

 Corn, soybean up on inclement weather worries

A farmer reaps corn in Taiping village, Shandong province. Liang Zhijie / for China Daily

SINGAPORE - Corn advanced to the highest in almost two years and soybeans traded at a 15-month high on concern flooding in the United States, the world's largest exporter of both, and freezing weather in China may damage crops.

Corn for December delivery gained as much as 1 percent to $5.27 a bushel, the highest price for the most-active contract in Chicago since Sept 29, 2008. November-delivery soybeans jumped as much as 1.6 percent to $11.4375 a bushel, the highest level for the most-active contract since June 5, 2009.

Western parts of the Midwest face further harvest delays this week as fields are very wet, and some areas remain flooded, Telvent DTN Inc said in a forecast on Friday. Northeast China will likely have freezing conditions, after rain showers early this week, potentially hurting maturing soybean and corn crops, DTN said.

"There are so many concerns in the market right now," Tetsu Emori, a commodity fund manager at Astmax Co Ltd in Tokyo, said by phone on Monday. "That's what's attracting fresh investment into the commodity market. Hedge funds are seeing good trends in prices."

As much as 40 percent of the crop in Minnesota, the fourth-largest US corn grower, may suffer reduced yields, Bob Zelenka, the executive director of the state's Feed and Grain Association in St Paul, said last week.

Hedge-fund managers and other large speculators increased their net-long positions in Chicago corn futures in the week ended Sept 21 to the highest since March 1996, according to US Commodity Futures Trading Commission data.

Corn futures traded at $5.2525 a bushel on the Chicago Board of Trade as of 2:15 pm Singapore time. Soybeans were at $11.3225 a bushel.

Speculative long positions, or bets prices will rise, outnumbered short positions by 465,714 contracts on the Chicago Board of Trade, the Washington-based commission said in its Commitments of Traders report. Net-long positions rose by 21,625 contracts, or 5 percent, from a week earlier.

Net-long positions in soybeans rose 16,681 contracts, or 11 percent to 163,087 in the week ended Sept 21, the most since May 1997.

The near-term supply of soybeans is tight and demand looks good, Phillip Futures said in a research note on Monday.

Bloomberg News

(China Daily 09/28/2010 page17)

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