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Corn futures rally to 4-day high on increased China demand

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Forex Pros - Corn futures rallied to a four-day high on Monday, after the U.S. Department of Agriculture confirmed U.S. exporters sold corn to China last week, boosting demand expectations from the world's second largest corn consumer.

On the Chicago Mercantile Exchange, corn futures for July delivery traded at USD7.5825 a bushel during European morning trade, climbing 1.32%.

It earlier rose as much as 1.48% to USD7.5888 a bushel, the highest price since May 23.

The U.S. Department of Agriculture said in its weekly grain report on Friday that China bought 116,800 metric tons of U.S. corn in the week ended May 20. Although many traders believed China made additional purchases this year, Friday's report was the first sale in 2011 confirmed by the USDA.

Volume of U.S. corn for export inspected at U.S. ports totaled 726,700 metric tons, 52% higher than the four-week average.

Meanwhile, lingering concerns over tightening U.S. supplies continued to support prices, as adverse weather in key corn-growing regions in the U.S. threatened crop production.

The USDA said last week that approximately 79% of U.S. corn crops were planted as of May 22, lower than the five-year average of 87% for this time of year.

The U.S. is both the world's largest corn producing nation and the world's largest exporter of the grain.

Elsewhere, wheat for July delivery added 0.58% to trade USD8.2012 a bushel, while soybeans for July delivery slumped 0.62% to trade at USD13.8012 a bushel during European morning trade.

Corn is the biggest U.S. crop, valued at USD66.7 billion in 2010, followed by soybeans at USD38.9 billion, government figures show. Wheat was fourth at USD13 billion, behind hay.

Also Monday, liquidity was relatively thin as U.K. markets were to remain closed for the Spring Bank Holiday and U.S. markets for Memorial Day.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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