Chicago Board of Trade corn futures extended a rally on Thursday above eight-year highs as dry weather threatened harvest yields in major exporter Brazil and kept the focus on ebbing global supplies.
Soybeans approached an 8-1/2-year peak reached last week, buoyed by rallying vegetable oil prices, while wheat was little changed.
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.”
The most-active corn contract was up 5-1/4 cents at $7.13-3/4 a bushel by 11:25 a.m. CDT (1625 GMT). It earlier touched the highest price since March 2013 at $7.22-1/2.
December corn that represents the next U.S. harvest was up 15-1/4 cents at $6.20 a bushel, after setting a contract high of $6.22-1/4.
CBOT wheat was flat at $7.44-1/2 a bushel.
The most-active soybean contract soared 24-1/2 cents to $15.66-3/4 a bushel. November soybeans that represent the next harvest set a contract high and were up 26-1/4 cents at $14.09.
Rising new-crop soy and corn prices reflected the battle to incite U.S. farmers to increase plantings to replenish tight stocks, analysts said.
Brokers are beginning to grow nervous that cool weather will slow the emergence of recently planted corn.
“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.
“The sentiment is pretty bullish, not just in corn but the entire grains complex,” said Phin Ziebell, agribusiness economist at National Australia Bank.
(Reporting by Tom Polansek in Chicago, Gus Trompiz in Paris and Naveen Thukral in Singapore; Editing by Edmund Blair, Kirsten Donovan)
