Corn tops $7 a bushel for first time since 2013 in most-active contract

* High corn prices are not destroying demand, Bunge CEO says

* Feed demand remains strong from meat producers - analysts

* Traders worry Brazil dryness threatens corn output

By Tom Polansek

CHICAGO, May 4 (Reuters) - U.S. corn futures on Tuesday topped $7 a bushel in the most-active contract for the first time since 2013 as unfavorably dry crop weather in Brazil kept attention on tightening global supplies.

Surging prices have done little to curb robust demand for corn used to feed livestock and produce ethanol, opening the door for the market to extend gains, U.S. analysts said.

There has been "no demand destruction" for crops amid strong profitability for meat production, said Greg Heckman, chief executive officer for global grains trader Bunge Ltd BG.N

Some Asian feed manufacturers are switching to wheat from corn in animal rations, though Heckman said an increase in wheat feeding to livestock in China is temporary.

"We've got good animal profitability and good demand right now," Heckman said on an earnings call with analysts.

The most actively traded July corn contract on the Chicago Board of Trade (CBOT) Cv1 settled up 17-1/4 cents at $6.96-3/4 per bushel. The market earlier reached $7.04 a bushel, the highest price for a most-active contract since March 2013. Front-month corn futures Cc1 matched Monday's eight-year high of $7.58-1/4 a bushel.

The gains helped pull up soybean and wheat prices, traders said.

Most-active wheat futures Wv1 closed 8-3/4 cents stronger at $7.26-3/4 per bushel, while soybeans SN1 finished up 14-1/4 cents at $15.38-1/4 per bushel.

Oilseed inventories are tight, keeping the soybean market supported in the face of concern over reduced vegetable oil demand in India due to surging coronavirus cases, traders said.

In Brazil, weather forecasts showed little sign of rain relief for dry southern corn-growing areas, keeping the focus on global supply woes despite U.S. planting progress. Brazil's second annual crop is seen as crucial to boosting short-term availability ahead of the U.S. harvest later in the year.

"In Brazil, the dry weather is still predominant and maize crops are suffering," consultancy Agritel said.
Reporting by Tom Polansek in Chicago, Gus Trompiz in Paris and Naveen Thukral in Singapore; Editing by Mark Potter, Andrea Ricci and Jonathan Oatis

Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.

All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.

Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.

We are using cookies to give you the best experience on our website. Read more or change your cookie settings.

Risk Warning: Your capital is at risk. Leveraged products may not be suitable for everyone. Please consider our Risk Disclosure.