Reduced output in South America raising call for US supplies
U.S. corn continued its longest rally in a year and soybeans jumped the most in 11 weeks on speculation that adverse weather may reduce output in South America, increasing demand for U.S. supplies.
Roughly 50% of Argentina crops will be dry through the first week of January 2012 after recent rain stayed north of the main growing regions, said Commodity Weather Group LLC in a report, and as much as a third of Brazil’s crops face a lack of rain. “Current weather trends are raising the odds that the South American crops will be reduced,” said Dave Marshall, a farm- marketing adviser at Toay Commodity Futures Group LLC in Nashville, Illinois.
Corn futures for March delivery rose 2.2% on December 27 to close at $6.3325 a bushel at 1:15 p.m. on the Chicago Board of Trade, the seventh straight gain and the longest rally since Dec. 29, 2010. Soybean futures for March delivery rose 3.2% to $12.095 a bushel, the biggest advance since October 11. It was the eighth straight gain, the longest rally since mid-July.