April 29, 2010
US corn and soy futures rally, wheat dips
Supported by the demand for US corn from China, corn futures in CBOT climbed by 2.9% on Wednesday (Apr 28) or US$3.64 a bushel, the biggest gain for a most-active contract in nine weeks; soy rose to US$9.935 per bushel, but wheat dropped to US$4.88 a bushel.
USDA said on Wednesday (Apr 28) that China purchased 115,000 tonnes of corn from US exporters for the first time in nearly four years, which has boosted the corn future price. Traders also indicated that dry weather in Brazil, which has also added upward pressure to corn price, could cut yields and decrease productions from high forecasts a few weeks ago.
Meanwhile, crude oil price bounced above US$83 per barrel on Wednesday (Apr 28) as the US Federal Reserves' decision to keep interest rates near zero increased the investor's appetite for riskier assets.
Traders noted that soy was mainly supported by the stronger crude oil market. Although they are concerned that rains, which is expected this weekend and into early May, could hamper corn planting and may slightly increase soy acreage.
The stronger performance of US dollar lifted the price of the country's grain exports, made it less competitive in the international markets, and especially weighed on wheat futures.
