By Jae Hur
Feb. 4 (Bloomberg) -- Corn gained for the first time in five days and soybeans advanced for the first day in three on speculation that recent price declines may lure buyers and China will resume purchases of the oilseed.
Corn dropped to the lowest in more than seven weeks yesterday and soybeans fell to a five-week low. China, the world’s top soybean buyer, will purchase an additional 2.5 million metric tons of domestic new-crop supplies for temporary stockpiles in the northeast province of Heilongjiang, the official Xinhua News Agency reported yesterday.
“China’s news has lent support to the grains market, together with a technical rebound,” Takaki Shigemoto, an analyst at Tokyo-based commodity broker Okachi & Co., said today by phone.
Corn for March delivery rose 0.8 percent in after-hours Chicago trade to $3.645 a bushel at 3:48 p.m. Singapore time. The grain lost 2.4 percent yesterday after touching $3.56, the lowest for the most-active contract since Dec. 12. Prices have fallen 54 percent from a record $7.9925 in June.
Soybeans for March delivery gained as much as 1.5 percent to $9.60 a bushel and last traded at $9.575. The contract fell 1.4 percent yesterday after dipping to $9.345, the lowest since Dec. 26. Futures are down 42 percent from an all-time high of $16.3675 on July 3.
China’s soybean purchases, to be carried out before the end of April, will bring the amount the government plans to buy to bolster reserves to 4.53 million tons in Heilongjiang, the Xinhua report said, citing the State Administration of Grain’s provincial branch. The move is aimed at stabilizing local oilseed prices and protecting farmers’ interests, the report said.
The grains market was also supported by the dollar’s decline and crude oil’s gain yesterday, Shigemoto said.
Oil Gains
The dollar rose as much as 0.7 percent against the euro today after losing 1.5 percent yesterday. Crude oil for March delivery advanced as much as 0.9 percent today, extending yesterday’s 1.8 percent gain.
Argentine farms will get more rainfall this week, easing a drought that is cutting the yields of corn and soybean crops, a weather forecaster said yesterday. Argentina is the second- largest exporter of corn after the U.S.
The nation’s farms will receive rain on Feb. 5, though it will be too late for corn plants already damaged by dry weather, Stella Maris Carballo, a forecaster at the National Institute of Agriculture Technology in Buenos Aires, said yesterday.
Wheat for March delivery was up 0.2 percent at $5.5375 a bushel at 3:46 p.m. Singapore time after falling 2 percent yesterday. Prices have tumbled 59 percent from a record $13.495 on Feb. 27.
In the export market, Egypt is seeking to buy at least 55,000 tons of wheat at a tender today and Japan plans to buy 128,000 tons of the grain tomorrow, including 86,000 tons from the U.S.
South Korea bought 165,000 tons of corn for feed production and 165,000 tons of feed wheat yesterday, according to two industry executives familiar with the transactions.
To contact the reporter on this story: Jae Hur in Singapore at jhur1@bloomberg.net
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