Oct. 24 (Bloomberg) -- Soybeans advanced for the first time in six sessions and corn surged as demand for raw materials used to make food may increase after European leaders outlined plans to aid banks. Rice rallied to a one-month high.
European leaders meeting in Brussels outlined plans to aid banks, inching toward a revamped strategy to contain the Greece- fueled debt crisis. A complete blueprint may be presented at a summit on Oct. 26.
“We have seen commodities across the board pick up today, and that just reflects largely the optimism moving into the European debt summit,” Michael Creed, an agribusiness economist at National Australia Bank Ltd., said by phone from Melbourne. “It does in part translate to demand, but it also means that funds are more willing to step back into risky assets.”
Soybeans for January delivery climbed 14 cents, or 1.1 percent, to $12.3475 a bushel by 1:15 p.m. London time on the Chicago Board of Trade. The price earlier gained as much as 2.2 percent. The most-active contract fell 3.9 percent last week.
Export sales of corn from the U.S., the world’s largest shipper, surged to 1.763 million metric tons in the week ended Oct. 13, the highest level since March, the Department of Agriculture said in a report on Oct. 20. Total sales for delivery before Aug. 31 are up 5 percent from a year earlier and are at a four-year high, USDA data show.
Corn for December delivery gained 10.25 cents, or 1.6 percent, to $6.595 a bushel in Chicago. The price is up 11 percent this month on speculation demand for the grain will increase.
Wheat for December delivery rose 10.75 cents, or 1.7 percent, to $6.4275 a bushel. The price has gained for six of the past seven sessions. Milling wheat for November delivery was little changed at 188 euros ($260) a metric ton on NYSE Liffe in Paris.
“The fundamentals and stock levels indicate upward movement,” said Kieran Walsh, a broker at GFI Securities in London. “There is a fair amount of talk about Chinese demand.”
About 12.5 percent of rice farmland in Thailand has been damaged, along with 6 percent in the Philippines, 12 percent in Cambodia, 7.5 percent in Laos and 0.4 percent in Vietnam, as storms and flooding hit the region since September, the United Nations’ Food and Agriculture Organization said in an Oct. 21 report.
“A large amount of the Thai, Filipino and Cambodian crops are going to be unfit for consumption, by all accounts,” GFI’s Walsh said today by phone.
Rough rice for January delivery climbed 40.5 cents, or 2.4 percent, to $17.12 per 100 pounds in Chicago and earlier touched $17.215, the highest price for the most-active contract since Sept. 21.
The UN’s FAO said it’s closely monitoring the situation because of “concerns of serious food shortages” in affected areas in Southeast Asia as flooding devastated crops and aid deliveries are disrupted.
--With assistance from Luzi Ann Javier in Singapore. Editors: John Deane, Sharon Lindores
-0- Oct/24/2011 12:49 GMT
-0- Oct/24/2011 12:50 GMT
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