BLBG:Corn Set to Gain on Speculation China May Boost U.S. Purchases
May 3 (Bloomberg) --Corn was poised to climb on speculation that China, the second-largest consumer, may boost purchases from the U.S. after drought cut the harvest in Argentina.
July delivery corn gained as much as 0.4 percent to $6.14 a bushel on the Chicago Board of Trade, after losing 3.6 percent in the past two days. It traded at $6.12 a bushel as of 11:58 a.m. Singapore time.
Exporters in the U.S., the biggest grower and shipper, sold 130,000 metric tons of corn to unknown destinations for delivery in the year starting Sept. 1, the U.S. Department of Agriculture said yesterday. Last week, the agency said exporters sold 1.44 million tons to unknown destinations, the biggest one-day sale since December 1994.
“China could be on a buying spree,” Lynette Tan, an analyst at Phillip Futures Pte., said by phone from Singapore today. “They will not have enough corn to meet their demand.”
Corn production in Argentina will drop to 21.2 million tons in the crop year that began March 1, compared with 23.6 million a year earlier, the USDA’s Foreign Agricultural Service said in a report yesterday. Output will rebound next year, reaching 24.68 million tons, the FAS said.
Wheat for July delivery gained as much as 0.9 percent to $6.1975 a bushel, before trading at $6.1825. The grain tumbled 4.4 percent yesterday, the most in more than three months, on speculation rain and warm weather will boost yields in the U.S.
Farmers in southwestern and central Kansas and parts of northern Oklahoma may collect 48.5 bushels an acre this year, according to a survey of 566 fields during the first two days of the Wheat Quality Council’s crop tour.
The yield estimate for fields in southwestern Kansas and northern Oklahoma, which were surveyed yesterday, was 43.7 bushels an acre, the highest for the second day of the tour since 2005, council data show. The record yield in Kansas was 49 bushels in 1998, USDA data show.
July-delivery soybeans were little changed at $14.8325 a bushel. Exporters in the U.S. sold 204,000 tons of soybeans to unknown destination for delivery in the marketing year beginning Sept. 1, and 30,000 tons of soybean oil to China for delivery in the 2011-2012 marketing year, the USDA said yesterday.
To contact the reporter on this story: Luzi Ann Javier in Manila at ljavier@bloomberg.net
To contact the editor responsible for this story: James Poole at jpoole4@bloomberg.net
