By William Bi
Dec. 19 (Bloomberg) -- Corn and soybeans declined after crude oil tumbled below $36 a barrel for the first time since June 2004, increasing speculation that a global recession may worsen, reducing demand for cooking oil, animal feed and biofuel.
Oil has dropped 33 percent this month even as OPEC agreed to its largest production cut in more than a decade. China’s cooking oil demand for the holiday month beginning Jan. 1 was less than expected, the China National Grain and Oils Information Center said in a report today.
“Crude oil is the bellwether of the general economy and all the other markets, so it’s telling us investors aren’t optimistic and this slump isn’t over,” said Li Zhao, manager at Yongan Futures Co. in Hangzhou. “While agricultural commodities are more resilient, they are not immune to the recession.”
March-delivery corn on the Chicago Board of Trade fell as much as 8.5 cents, or 2.2 percent, to $3.81 a bushel and traded at $3.8225 at 12:23 p.m. Beijing time.
Soybeans for March delivery declined as much as 9.75 cents, or 1.1 percent, to $8.6475 a bushel, and were last at $8.6775.
March-delivery wheat fell as much as 1.8 percent to $5.61 a bushel before trading down 1.6 percent at $5.6225. Most-active rough rice futures dropped 0.6 percent to $14.78 per 100 pounds.
To contact the reporter on this story: William Bi in Beijing at wbi@bloomberg.net
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