Corn Advances as Cold Damages Argentine Corn Crops; Soybeans Up

By Jae Hur

Nov. 19 (Bloomberg) -- Corn gained on speculation that cold weather in Argentina will damage crop production, raising the sales prospect for U.S. supplies. Soybeans also rose, while wheat was little changed.

Argentine corn and wheat crops were damaged by freezing overnight temperatures, according to Eduardo Sierra, the weather forecaster for the Buenos Aires Cereals Exchange. Argentina is the world's second-largest exporter of corn and third-biggest exporter of soybeans.

``Crop weather in Argentina and Brazil will get more attention, with the U.S. harvest progressing,'' said Hiroyuki Kikukawa, general manager of research at IDO Securities Co. in Tokyo. ``Also all the bearish factors have already factored into the market, making people reluctant to bet on a price drop.''

Corn for December delivery was up 0.5 percent at $3.8175 a bushel in after-hours trading in Chicago at 10:15 a.m. Singapore time. The grain lost 1.5 percent yesterday. The price still is down 52 percent from a record $7.9925 on June 27.

Soybeans for January delivery rose 0.4 percent to $9.0575 a bushel at 10:31 a.m. Singapore time. The price is down 45 percent from a record $16.3675 on July 3.

The cold harmed newly planted corn in Buenos Aires province, Sierra said. About 300,000 hectares (741,300 acres) were most affected, or about 12 percent of the 2.5 million hectares that are expected to be sown, he said. One farmer in the northern part of the province lost 80 percent of his crop, according to Sierra.

The area planted with the 2008-09 corn crop in Argentina will be the smallest in more than a decade after dry weather and government export restrictions discouraged farmers, the exchange said Nov. 14. Wheat output may drop 36 percent to 10.5 million metric tons, from 16.3 million tons in the 2007/2008 season, the exchange said.

Wheat for March delivery was down 1 cent at $5.485 a bushel at 10:28 a.m. Singapore time. Futures have fallen 59 percent from a record $13.495 on Feb. 27, partly because global growers increased planting to exploit prices that rose 77 percent in 2007.

Japan is seeking to buy 91,000 tons of U.S. milling wheat at a tender tomorrow.

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