US corn, soy futures rise on improved Chinese demand

Corn and soybeans rose on speculation that a surging Chinese economy will boost demand for US exports.

China, the world's largest soy importer and second- largest consumer of corn, said that its economy expanded by 11.9% in the first quarter, the fastest pace in almost three years. Domestic corn costs as much as 12% more than imported US grain. China accounted for 79% of US soy exports in the week ended April 8, according to a USDA report.

Don Roose, the president of US Commodities Inc. noted that demand is also improving in the US, as rising cattle, hog and chicken prices increase demand for animal feed.

Corn futures for July delivery rose 3.5 cents, or 0.9%, to US$3.72 a bushel at 10:35 a.m. on the CBOT, heading for a fourth straight gain; while soy futures for July delivery climbed 4.5 cents, or 0.5%, to US$9.815 a bushel in Chicago, up for a fifth session and headed for the longest rally since March 22.

Earlier, the most-active corn contract dropped 11% this year on forecasts for production to rise 13% in Brazil and Argentina, the biggest exporters after the US. Soy declined 6.2% this year on USDA estimates for record global stockpiles before the US harvest.