Grains, beans rise on hopes for global demand

AP News
Posted: Feb 17, 2012 4:00 PM
Grains, beans rise on hopes for global demand

Prices for wheat, corn and soybeans rose Friday on worries that bad weather may have damaged crops in Europe and South America.

Investors speculated that demand for all three crops will improve. Wheat prices rose 2.4 percent, while corn and soybeans were up nearly 1 percent.

Global wheat supplies are plentiful so far, but there has been speculation that freezing winter weather hurt crops in parts of Europe, which could cut into stockpiles.

Corn and soybeans supplies are already tight worldwide. Investors are speculating that inventories will shrink even more as details become available about potential crop damage from hot weather in Brazil and Argentina, Telvent DTN analyst Darin Newsom said.

In a report issued last week, the U.S. Agriculture Department estimated global wheat stockpiles at 213.1 million metric tons by the end of the summer. Global corn supplies were forecast at 125.4 million metric tons and soybean stockpiles were estimated at 60.28 million metric tons.

"The market itself believes it's much tighter than what the government said and so that would indicate subsequent reports will show further tightening," Newsom said.

Other commodities were mixed as investors re-evaluated their holdings as a precaution in case there are developments in the Greek debt crisis over the President's Day weekend.

Negotiations over the best way to fix Greece's financial troubles have weighed on the market most of the week. Finance ministers from countries that use the euro will meet Monday to discuss another bailout package for Greece. U.S. markets will be closed Monday for Presidents' Day.

Investors have been concerned that Greece could default on its massive debt if the funding isn't available before a deadline next month. That could cause slower economic growth and less demand for commodities.

In metals trading, gold for April delivery fell $2.50 to finish at $1,725.90 an ounce. In March contracts, silver declined 15.4 cents to end at $33.216 per ounce, copper decreased 8.3 cents to $3.708 per pound and palladium ended down $8.50 at $688.10 an ounce. April platinum rose $7.80 to $1,633.90 an ounce.

Oil prices rose on prospects for slower deliveries from the Middle East if Iran continues to clash with Western nations over its nuclear program.

Benchmark oil rose 93 cents to finish at $103.24 per barrel on the New York Mercantile Exchange. Heating oil fell 2.08 cents to end at $3.1889 per gallon, gasoline futures declined 3.15 cents to $3.0156 per gallon and natural gas rose 11.7 cents to $2.684 per 1,000 cubic feet.