Corn Gains as Equities Rally Improves Demand Outlook; Wheat Up

By Jae Hur

Nov. 14 (Bloomberg) -- Corn extended gains on speculation a rally in U.S. stocks and the dollar's decline will help revive demand for food, animal feed and fuel. Soybeans declined, while wheat gained for a fourth day.

Asian equities rallied after U.S. stocks jumped the most in two weeks, with the Standard & Poor's 500 Index rising 6.9 percent. The dollar slid 2 percent against the euro yesterday, the most since Nov. 4, and crude oil gained 3.7 percent. Corn has lost 53 percent from a record in June and soybeans have fallen 46 percent from an all-time high in July.

``High volatility in equity markets continues to be mirrored by elevated volatility in commodities,'' Toby Hassall, an analyst at Commodity Warrants Australia Ltd. in Sydney, said. ``Crude oil, metals and grains are all driving higher as a result of the surge in stocks and the weaker dollar.''

Corn for December delivery added as much as 2.5 percent to $3.8625 a bushel in after-hours trading in Chicago and was at $3.7925 at 4:10 p.m. Singapore time. The price touched $3.6025 a bushel Nov. 11, the lowest since Oct. 25, 2007. Futures reached a record $7.9925 on June 27.

January-delivery soybeans were down 0.3 percent at $8.915 a bushel after trading as high as $9.10. The price fell to $8.38 on Oct. 16, the lowest since August 2007. Futures touched a record $16.3675 on July 3.

Crude oil for December delivery fell 1 percent to $57.64 a barrel at 4:15 p.m. Singapore time after trading between $57.55 and $59.96. The dollar was at $1.2693 against the euro from $1.2769 late yesterday in New York.

Wheat Advances

Wheat for March delivery advanced as much as 3 percent to $5.755 a bushel and was at $5.60 at 4:06 p.m. in Singapore. Wheat, which reached a record $13.495 on Feb. 27, touched $4.965 on Oct. 24, the lowest since June 2007.

Wheat has also been supported by speculation that U.S. farmers, the world's largest exporters of the grain, will plant fewer acres of winter varieties because wet weather delayed the corn and soybean harvests.

About 71 percent of the U.S. corn harvest was completed as of Nov. 9, compared with 92 percent at the same time last year, the Department of Agriculture said earlier this week. About 7 percent of the soybean crop remained to be harvested, compared with 5 percent a year earlier.

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