BLBG: Corn, Wheat Fall as Dollar’s Gain Curbs Demand for U.S. Crops
By Jae Hur
Dec. 21 (Bloomberg) -- Corn and wheat declined as the dollar traded near the highest in more than three months, eroding the appeal of U.S. supplies. Soybeans climbed.
Grains fell as the dollar traded near a three-month high against the euro as signs that the world’s largest economy is gaining traction and lingering credit concerns in Europe buoyed demand for the greenback. A rise in the dollar reduces demand for U.S. crops from overseas buyers holding other currencies.
“In the pre-holiday trading, the dollar will set the direction for grains and other commodities,” said Hiroyuki Kikukawa, general manager of research at Tokyo-based IDO Securities Co.
Corn for March delivery declined 0.4 percent to $3.9625 a bushel in electronic trading on the Chicago Board of Trade at 1:23 p.m. in Tokyo.
March-delivery wheat dropped 0.3 percent to $5.265 a bushel after gaining 1.8 percent on Dec. 18, the largest advance since Nov. 30. The grain has lost 10.6 percent this month.
The Dollar Index, a gauge against a basket of six major currencies, traded at 77.702 after reaching 78.141 on Dec. 18, the highest level since Sept. 4.
U.S. corn farmers will boost planting next year to 89.504 million acres, up from the 86.351 million acres that the government estimates was sown in 2009, Memphis, Tennessee-based researcher Informa Economics Inc. said Dec. 18 in a report.
Wheat Area
Wheat farmers in the U.S. may reduce planting next year to 55.659 million acres, down from the 59.133 million that the government said was sown in 2009, according to the report.
U.S. soybean farmers will reduce planting next year to 76.993 million acres, down from the 77.51 million acres that the government estimates was sown in 2009, according to Informa.
March-delivery soybeans were 0.2 percent higher at $10.2225 a bushel by 1:18 p.m. Tokyo time after trading between $10.1925 and $10.26. Last week, the contract slumped 1.5 percent, the biggest slide since the week ended Nov. 6.
To contact the reporter on this story: Jae Hur in Tokyo at jhur1@bloomberg.net
