Chicago: Soybeans dropped to the lowest in almost four weeks and corn fell on speculation that the world's central banks will boost interest rates to fight inflation, reducing demand for crops from the US, the biggest exporter.
Rising food and fuel costs may put pressure on importing countries to slow the pace of growth. The leaders of Brazil, Russia, India, China and South Africa said excessively volatile commodities pose a threat to the global economy. Before yesterday, corn prices doubled in the past year, and soybeans rose 38 per cent.
"The bullish commodity environment is changing" with the threat of higher interest rates, said Don Roose, the president of US Commodities Inc. in West Des Moines, Iowa. "The markets are focused on the potential for slowing demand," encouraging speculators to reduce bets on higher prices, he said.
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Soybean futures for July delivery fell 13.25 cents, or 1 per cent, to $13.3175 a bushel on the Chicago Board of Trade, after touching $13.2825, the lowest since March 18. Prices are headed for a weekly decline on speculation that China may reduce imports as the government sells discounted supplies from state reserves to curtail inflation.
Corn futures for July delivery fell 11.75 cents, or 1.5 per cent, to $7.4925 a bushel in Chicago, after reaching $7.5025, the lowest since April 4. On April 11, the commodity reached $7.8875, the highest since June 2008, after the government said U.S. inventories before the harvest would fall to the lowest since 1996.
Corn is the biggest US crop, valued at $66.7 billion (Dhg245.3 billion) in 2010, followed by soybeans at $38.9 billion, government figures show.
(Source: http://gulfnews.com/business/markets/soybeans-corn-fall-on-interest-rate-worries-1.792782)
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