February 26, 2010

US corn rises as lower dollar boosts crop demand

Corn advanced in CBOT on speculation that a slide in the dollar against other currencies may boost demand for farm commodities from the US, the biggest exporter of the crops.

The US Dollar Index, a six-currency gauge of the greenback's strength, fell for a third day as a struggling labour market clouds outlook of the economic recovery. Federal Reserve Chairman Ben S. Bernanke said the US economy requires low interest rates to encourage demand.

Corn futures for May delivery gained as much as 0.9% to US$3.865 a bushel in after-hour trading on the CBOT. It traded at US$3.86 at 2:21 p.m. Beijing time. The price is down 6.9% this year.

Meanwhile, Soy futures for May delivery rose 0.2% to US$9.5175 a bushel in Chicago. The price has dropped 9.2% this year as countries, including China, the biggest buyer, switched to buying a record harvest in Brazil and Argentina, the largest exporters behind the US.

Wheat for May delivery advanced 0.6% to US$5.0675 a bushel. The price has dropped 6.5% this year, partly on forecasts for bigger global inventories.