Grain futures advance on rising investor confidence

 

 

Corn gained for a third day, while soy and wheat advanced, as concerns eased that Greece's budget deficit may slow Europe's economic recovery.

 

Corn for March delivery gained 0.3% to US$3.595 a bushel, while soy for delivery in the same month added as much as 0.5% to US$9.2925 a bushel on the CBOT, before trading at US$9.2825 at 11:08 a.m. Singapore time.

 

Olli Rehn, who is taking over as EU economic affairs commissioner, said that support for Greece will be discussed within days. Lawmakers in Germany are considering financial assistance to Greece, Michael Meister, a legislator from Chancellor Angela Merkel's Christian Democratic Union, said.

 

''We're getting confidence back into the market,'' Jonathan Barratt, managing director at Commodity Broking Services Pty, said.

 

Wheat for March delivery advanced as much as 0.8% to US$4.8625 a bushel before trading at $4.8525.

 

Prices also climbed after the USDA lowered its estimates for global corn and soy stockpiles this year, and boosted its outlook for demand, Barratt said.

 

The USDA cut its world corn inventory estimate before the next Northern Hemisphere harvest to 134 million tonnes, from 136.2 million tonnes in January. That compares with stockpiles of 145.9 million tonnes the previous year.

 

Global corn consumption will outpace production for the first time in three years, as rising use of the grain in ethanol production in the US, the world's biggest consumer, grower and exporter, helps drain supplies, the USDA said.

 

The department raised its estimate for global corn consumption for the year that began October 1 to 809.7 million tonnes, from 806.2 million tonnes in January and 775.2 million tonnes last year.

 

The output estimate was raised to 797.8 million tonnes, from 796.5 million tonnes in January, on increased production in Argentina, the USDA said. That will beat the record production of 791.5 million tonnes posted a year earlier.

 

Global stockpiles of soy on October 1 will be 59.7 million tonnes, down from 59.8 million tonnes forecast in January, as the USDA increased its US exports outlook. The average estimate of 13 analysts surveyed was 60.3 million tonnes. Stockpiles were at 41.6 million tonnes a year earlier, the department said.