Corn advanced to the highest level since July 2008 and soybeans gained on speculation a crude oil rally may increase demand for alternative fuel. Wheat increased.
May-delivery corn jumped as much as 3.3 percent to $7.4425 a bushel, the highest price since July 7, 2008, on the Chicago Board of Trade and traded at $7.245 a bushel at 5:46 p.m. Tokyo time. The Chicago market was closed yesterday.
Oil soared to the highest price in more than two years as violence intensified in Libya, stoking concern supplies will be disrupted as tension escalates in the Middle East and North Africa. Crude for April delivery was up 9 percent from the Feb. 18 close at $97.84 a barrel. Higher prices may boost demand for corn and soybeans as a source of biofuel.
“A sharp rally in oil prices sent corn and soy higher today,” said Han Sung Min, a broker at Korea Exchange Bank Futures Co. in Seoul. There’s also speculation some nations, especially in North Africa and the Middle East, will increase imports to curb food inflation, he said.
In Libya, leader Muammar Qaddafi’s son yesterday threatened “rivers of blood” and deployed security forces against protesters. At least 250 people died in Tripoli alone, al- Jazeera reported, citing witnesses.
The higher costs of wheat, sugar and dairy products sent the United Nations’ World Food Price Index to an all-time high last month. The jump has contributed to revolts in Tunisia and Egypt, as well as other Arab nations.
Soybeans for May delivery rose as much as 1.2 percent to $13.975 a bushel and traded at $13.87 a bushel. Last week, the price fell 2.5 percent, the second straight decline. On Feb. 9, the most active contract reached $14.5575, the highest level since July 2008.
Rains in Brazil’s soy-producing regions of Mato Grosso, Goias and South Mato Grosso are hurting the nation’s harvest, forecaster Somar Meteorologia said yesterday. Brazil is the second-biggest supplier after the U.S.
Wheat for May delivery gained as much as 1.6 percent to $8.695 a bushel and last traded at $8.645. The grain tumbled 4.8 percent last week, the biggest drop since the week to Oct. 22.
Drought in north China, the world’s largest wheat grower, may cause significant losses to grain supplies this year, prompting increased imports and tightening global supplies, according to Weather Trends International.
The driest weather in at least 50 years in the nation’s wheat-growing region may cut 1 percent to 1.5 percent from the national average wheat yield, said Michael Ferrari, vice president for technology and research. It may take at least a month before the weather pattern shifts to normal rain, and three months to end the drought, Ferrari said in an interview.