Soybeans and corn gained after China refrained from raising interest rates and as optimism increased that the U.S. economic recovery is gathering steam, increasing demand for commodities. Wheat declined for a second day. Soybeans for January delivery rose as much as 1 percent to $12.8575 a bushel on the Chicago Board of Trade and were at $12.84 as of 3 p.m. Tokyo time. The price earlier touched $12.57, the lowest level since Dec. 1. The oilseed lost 2.1 percent last week, after gaining 8.2 percent the previous two weeks. China won’t raise rates because that would fuel fund inflows from overseas and exacerbate inflation, said He Zhen, who helps manage $301 million as general manager at Shanghai Huili Asset Management, echoing comments made by Wu Xiaoling, a former deputy governor of the central bank, at a hedge fund conference in Shanghai on Dec. 11. “Commodities were underpinned by market speculation on China’s inflation rate hike,” said Hiroyuki Kikukawa, general manager of research at IDO Securities Co. in Tokyo. China’s the world’s biggest soybean importer. China’s soybean imports rallied 47 percent to 5.48 million metric tons in November, the first gain in five months. Shipments in October fell to the lowest level in eight months, according to Bloomberg News calculations based on data posted Dec. 10 by the General Administration of Customs. The country’s purchases in the first 11 months rose 31 percent to 49.37 million tons, it said. Asian stocks and commodities advanced today while the dollar strengthened for a sixth day. Copper and rubber reached records. In China, the Shanghai Composite Index, which tracks the bigger of China’s stock exchanges, increased as much as 2.2 percent, set for the biggest advance since Nov. 1. Dollar Gain The Dollar Index, which tracks the currency against six major peers, rose 0.3 percent, and was set for its longest stretch of gains since June. China on Dec. 10 ordered banks to set aside larger reserves and didn’t announce an interest-rate increase, even as data released the following day showed the inflation rate reached 5.1 percent in November while industrial-output growth and retail sales grew. As Federal Reserve policy makers meet tomorrow, a U.S. Commerce Department report will likely show retail sales climbed for a fifth straight month, adding to data that showed consumer confidence increased in December to a six-month high. Corn for March delivery rose as much as 0.7 percent to $5.78 a bushel in Chicago before trading at $5.7725. The price earlier lost as much as 0.9 percent. Wheat for March delivery fell 0.2 percent to $7.74 a bushel after trading between $7.665 and $7.78. The grain declined 0.5 percent last week, the first drop in three weeks. Wheat Stockpiles Global wheat inventories will be 176.72 million tons by May 31, 2.4 percent more than last month’s estimate, the U.S. Department of Agriculture said Dec. 10. Stockpiles were higher than any of the forecasts in a Bloomberg News survey of 17 analysts. The USDA raised its crop estimate for Australia by 6.3 percent, even after heavy rains threatened output. On Aug. 31, U.S. corn inventories will total 832 million bushels (21.1 million tons), up from 827 million forecast in November, the USDA said. Analysts surveyed by Bloomberg News expected 806 million, on average. To contact the reporter on this story: Jae Hur in Tokyo at jhur1@bloomberg.net To contact the editor responsible for this story: James Poole at jpoole4@bloomberg.net

Source