June 8 (Bloomberg) -- Corn rose for a second day in Chicago, maintaining the most-active contract’s premium over wheat, on speculation the U.S. corn harvest will be smaller than estimated because of late planting.
The corn crop faces “potential for shortfall” because of the delays, Goldman Sachs Group Inc. said in a report on June 6. Seeding may be as much as 2 million acres less than “original intentions,” resulting in a decline of as much as 250 million bushels, the bank said. Sowing was held up by wet weather in the U.S., the world’s biggest exporter of the grain.
“While the corn planting, which was delayed for a long time because of the extremely wet conditions, is now catching up, the development of the plants still lags behind the long- term average overall,” said Carsten Fritsch, an analyst at Commerzbank AG in Frankfurt. “Furthermore, the condition of the plants is not as good as last year, though not worryingly.”
Corn for July delivery gained 2.25 cents, or 0.3 percent, to $7.3875 a bushel by 11:13 a.m. London time on the Chicago Board of Trade. The grain more than doubled in the past year and yesterday closed at $7.365, while wheat settled at $7.3375 a bushel. That’s the first time since 1984 that the most-active corn contract became more expensive than wheat, according to data compiled by Bloomberg.
“Supply-demand factors continue to support corn prices,” Jonathan Barratt, managing director of Commodity Broking Services Pty in Sydney, said by phone today. “When you look at wheat, you obviously have favorable weather.”
Wheat for July delivery gained 3 cents, or 0.4 percent, to $7.3675 a bushel. The grain jumped 70 percent in the past year. Milling wheat for November delivery traded on NYSE Liffe in Paris rose 2.50 euros, or 1.1 percent, to 228 euros ($334) a metric ton.
Soybeans for July delivery slipped 3.5 cents, or 0.3 percent, to $13.905 a bushel in Chicago. The oilseed climbed 49 percent in the past year, helped by demand from China, the world’s largest importer of soybeans.
--With assistance from Luzi Ann Javier in Singapore and Jeff Wilson in Chicago. Editors: Dan Weeks, Nicholas Larkin.
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