Grains, beans jump on hope for global demand
Thursday, March 17, 2011; 5:07 PM
-- Wheat, corn and soybean prices jumped Thursday on speculation global demand will be strong even if Japan cuts purchases as it copes with its nuclear crisis and recovers from last week's earthquake and tsunami.
Wheat prices rose 7.3 percent Thursday, corn rose nearly 5 percent and soybeans rose nearly 4 percent.
They joined a broad rally in commodity prices just days after Japan's crisis sent most contracts reeling over fears about long-term demand.
Those concerns appeared to ease with expectations that other nations would buy products such as corn and wheat that normally would be shipped to Japan until that country's recovery is well under way, said Jason Ward, an analyst with Northstar Commodity.
Ward expects Japan's purchases of U.S. exports to decline for at least a month, in part because of infrastructure issues. Ships are being diverted to southern ports, which will slow their turnaround time, he said.
Corn and soybeans are in short supply globally. Traders have been concerned that global wheat stockpiles could tighten if the U.S. winter wheat crop has been damaged by a dry winter.
In contracts for May delivery, wheat gained 48.25 cents, or 7.3 percent, to settle at $7.1025 a bushel, corn added 30 cents, or 4.9 percent, to $6.465 a bushel and soybeans rose 48.25 cents, or 3.8 percent, to $13.3525 a bushel.
In other trading, metals used largely to manufacture products rose after a new report said factories produced more cars, appliances, computers and appliances last month. Manufacturers have increased production in 17 of the 21 months since the recession ended.
Copper, which is used in a number of products from construction materials to electronics, rose 14.65 cents, or 3.5 percent, to settle at $4.344 a pound.
April platinum added $6.40 to settle at $1,706.90 an ounce and June palladium gained $11.75 to $716.80 an ounce.
Gold for May delivery rose $8.10 to settle $1,404.20. Silver fell 21.4 cents to $34.258.
Oil prices rose sharply after a crackdown on protesters in Bahrain and as the United States pressed for United Nations action against Libya's Moammar Gadhafi.
Prices also benefited from expectations that Japan will increase fuel imports as it recovers.
Benchmark crude for April delivery added $3.44, or 3.5 percent, to settle at $101.42 per barrel on the New York Mercantile Exchange.
In other trading, heating oil added 6.77 cents to settle at $3.0649 a gallon and gasoline gained 10.69 cents to $2.9506 a gallon. Natural gas rose 22 cents, or 5.6 percent, to settle at $4.158 per 1,000 cubic feet.