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Corn prices rally

CHICAGO: Tight supplies of corn, booming exports and less-than-optimistic expectations for the fall crop drove corn prices sharply higher for the second consecutive session Monday.

At the Chicago Board of Trade, May corn jumped 7.5 cents to $4.16-1/2 a bushel, a record-high price for a nearby corn contract and near the all-time high for any corn contract of $4.19-1/4 set on Nov. 28, 1980.

"It's just a continuation from Friday," said Victor Lespinasse of Dean Witter Reynolds.

The rally helped lift wheat and soyabean prices sharply, with May wheat up 12.25 cents to $5.11-1/2 a bushel and May soyabeans up 10 cents to $7.61 a bushel.

November soyabeans rose 13 cents, as traders bet that more farmers switch acres previously planted to soyabeans over to corn.

A government report on Friday showed corn stocks will be only 412 million bushels as of Sept. 1 ahead of the next harvest, which is less than one-third of a year ago. Traders said to meet that goal, livestock ranchers and other consumers will have to cut down usage.

On Monday, a report showed 44 million bushels of corn were inspected for export, a still-rapid pace despite escalating prices.

The government also estimated Friday that farmers intended to plant 80 million acres of corn this spring, which was 12 percent above last year but still below analysts' estimates for what was needed to replenish stocks.

In the wheat market, news related to the outbreak of karnal bunt fungus in some durum wheat in the southwest continued to affect prices.

China, a major grain importer that bars imports from countries where the fungus is present, said it will accept U.S. wheat that is certified to be fungus-free.

In addition, Canada rescinded a declaration made Friday that it would bar U.S. wheat exports through the St. Lawrence Seaway for fear infected wheat could contaminate its grain elevators.

In other commodity markets, oil prices resumed an uptrend on the tight supply situation, and hog prices rose on a report showing a smaller herd than expected. The Knight Ridder index of 17 commodities rose 0.81 to 252.21.

The six-week rally in crude oil resumed after last week's downward correction, with May contracts rising 79 cents to $22.26 a barrel at the New York Mercantile Exchange.

U.S. crude and product stocks remain near historic lows. However, traders said United Nations talks on limited Iraqi oil sales resume on April 8.

May gasoline jumped 1.15 cents to 66.00 cents a gallon, and May heating oil added 1.23 cents to 57.98 cents a gallon.-Reuter