Oct. 5 (Bloomberg) -- Corn futures gained the most in five weeks and soybeans rebounded from an 11-month low as demand rebounded from producers of food, livestock feed and biofuels following the September slump in prices.
The U.S. reported bigger hog and feedlot-cattle herds last month, and gasoline futures climbed as much as 3.5 percent today. Federal Reserve Chairman Ben S. Bernanke said yesterday that the central bank may take more steps to sustain an economic recovery. In September, corn tumbled 23 percent, the most since at least 1959, and soybeans had the biggest drop in three years.
“With the price decline, profits are back for the cattle, hog and ethanol producers,” Jim Gerlach, the president of A/C Trading Inc. in Fowler, Indiana, said in a telephone interview. “Whatever demand destruction was occurring at higher prices is now reversing. The Fed is signaling it is ready to help boost economic growth.”
Corn futures for December delivery rose 17.75 cents, or 3 percent, to close at $6.055 a bushel at 1:15 p.m. on the Chicago Board of Trade, the largest gain for a most-active contract since Aug. 26.
Soybean futures for November delivery rose 3.75 cents, or 0.3 percent, to $11.6375 a bushel. Yesterday, the oilseed touched $11.52, the lowest since Oct. 11, 2010. The commodity slumped 19 percent in September.
Corn may rise on lower global inventories, and soybeans might gain as Chinese demand remains “resilient,” said Abah Ofon, an analyst in Singapore at Standard Chartered Bank.
“The deep decline in grain markets plays into the hands of buyers,” Ofon said in a report. China will “relish the recent collapse of prices, given it has been grappling with high domestic demand for corn,” he said.
Drought in Argentina and dry weather in parts of Brazil may hurt crops, Oil World, a research company, said in a report. Planting began last month in those nations, the world’s leading exporters of corn and soybeans behind the U.S.
Corn is the largest U.S. crop, valued at $66.7 billion in 2010, followed by soybeans at $38.9 billion.
--With assistance from Tony Dreibus in London. Editors: Patrick McKiernan, Millie Munshi
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