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Dec. 6 (Bloomberg) -- Corn rose from a two-month low and soybeans gained on speculation that prices that have fallen at least 20 percent since Sept. 1 will spark demand from food, meat and fuel producers.
Cash cattle prices have risen 24 percent in the past year, reaching a record yesterday, according to government statistics. Cash hogs are up 27 percent. U.S. ethanol producers are making 31.37 cents a gallon, Bloomberg data shows. Corn and soybean futures have dropped in the past three months as rising world production reduced U.S. exports.
“Prices have fallen so much since September that there is a little bit of buying beginning to surface” from U.S. fuel and meat producers, Dave Marshall, a farm marketing adviser for Toay Commodity Futures Group LLC in Nashville, Illinois, said in a telephone interview. “Prices probably have fallen enough until we know more about the South American weather situation.”
Corn futures for March delivery rose 0.9 percent to close at $5.965 a bushel at 1:15 p.m. on the Chicago Board of Trade, snapping a three-day decline. Earlier, the price fell to $5.80, the lowest since Oct. 4. The grain dropped 6 percent in November as overseas buyers shifted to cheaper supplies from Ukraine and Argentina.
Soybean futures for January delivery rose 0.3 percent to $11.295 a bushel in Chicago. The price, which touched a 13-month low of $11.0275 on Nov. 25, dropped 7.1 percent last month.
In Argentina, drier weather the next 15 days will reduce soil moisture in about a third of the corn and soybean growing areas, the Commodity Weather Group LLC said today in a report today. Rains the next week in Brazil may begin to ease dryness that’s affecting about 40 percent of the crops, the private forecaster said.
“The soybean market found some support from the uncertainty about the dry weather in South America,” Marshall of Toay Commodity Futures said.
Corn is the biggest U.S. crop, valued at $66.7 billion in 2010, followed by soybeans at $38.9 billion, USDA data show.
--Editors: Daniel Enoch, Millie Munshi.
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