Corn, Soybeans Advance on Government Plan to Support Markets

By Feiwen Rong

Sept. 19 (Bloomberg) -- Corn and soybeans rose, mirroring gains in stocks, as governments took steps to support financial companies to prevent the global financial crisis from worsening.

Prices climbed as Asian stocks and U.S. futures surged after the world's largest central banks agreed to inject $247 billion into financial markets and the U.S. worked on plans to assist banks and insurers. Corn fell the most allowed by the Chicago Board of Trade yesterday and soybeans dropped to a nine-month low.

Grains are ``swinging along with other markets like equities and currencies,'' Nobuyuki Chino, president at Unipac Grain Ltd., said today by phone from Tokyo. ``The grains and oilseeds market is responding to influences beyond its own fundamentals.''

Corn for December delivery advanced 0.8 percent to $5.3125 a bushel in after-hours trading on the Chicago Board of Trade by 2:38 p.m. Singapore time. Futures are down 5.6 percent this week and 34 percent from a record $7.9925 on June 27.

Soybeans for November delivery advanced 1.1 percent to $11.28 a bushel. Prices touched $10.995 yesterday, the lowest since Dec. 7. The oilseed has lost 31 percent from a July record of $16.3675.

Soybeans may have further to rise ``because the market is very tight,'' Chino said. Stocks-to-use ratio, a measurement of stockpiles divided by consumption, is projected to drop to 4.6 percent by the end of this year, close to the historical low, Chino said.

``I remain very much a soybean bull,'' Emily French, senior vice president of Macquarie Bank Ltd.'s treasury and commodities group, said yesterday in an interview in Dalian, China. ``The U.S. balance sheet is so tight you can't afford to lose any acreage out of the U.S.''

Wheat for December delivery was up 0.8 percent at $6.9825 a bushel after tumbling 4.6 percent yesterday. The futures have fallen 48 percent from a record $13.495 on Feb. 27.

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To contact the reporter on this story: Feiwen Rong in Singapore at frong2@bloomberg.net