Corn Futures Pierce Eight-Year Peak, Soy Rallies On Supply Worries
Chicago Board of Trade (CBOT) corn futures extended a rally above eight-year highs on Thursday as dry weather threatened harvest yields in major exporter Brazil and kept traders' focus on ebbing global supplies.
Soybeans approached an 8-1/2-year peak reached last week, buoyed by rallying vegetable oil prices, and wheat was also higher.
Corn crop losses due to dryness in Brazil could shift export demand to the United States, which is already grappling with tight inventories, analysts said.
"We're still very dry in Brazil," said Brian Hoops, president of U.S. brokerage Midwest Market Solutions. "That crop is in retreat."
U.S. corn export sales totalled 243,500 tonnes in the week ended 29 April, falling below estimates for 300,000 to 1.5 million tonnes after recent price rallies.
Most-active CBOT corn settled up 10-1/4 cents at $7.18-3/4 per bushel, after reaching its highest price since March 2013 at $7.22-1/2.
December corn, which represents the crop that will be harvested in the autumn, climbed 20-3/4 cents to $6.25-1/2 a bushel and set a contract high of $6.28.
Most-active wheat ended 8-3/4 cents firmer at $7.53-1/4 per bushel.
Most-active soybeans settled up 27-1/4 cents at $15.69-1/2 per bushel. November soybeans that represent the autumn crop climbed 26-1/4 cents to $14.09 a bushel and set a contract high of $14.17-1/4.
Rising new-crop soy and corn prices reflect the battle to incite U.S. farmers to increase plantings to replenish tight stocks, analysts said. As plantings progress, some grain brokers are beginning to grow nervous that cool weather will slow the emergence of corn crops.
"There's some concerns that this year's crop is not off to one of the greatest starts ever," Hoops said.
A 13-year high for palm oil, against a backdrop of tight global edible oil supplies, helped boost soybean futures, traders said.
World food prices increased for an 11th consecutive month in April to a near-seven year high, according to the United Nations food agency.