US corn jumps by daily limit to hit two-year high

Chicago corn jumped 8.5 per cent on Monday to its highest in more than two years, marking its sharpest gain since 1972, after the U. government forecast supplies in the world's top exporter to shrink to their lowest in 14 years. Chicago Board of Trade December corn futures surged as much as 45 cents to hit a high of $5.73-¼ a bushel, the highest since September 24, 2008, and trading limit up for the second straight day. By 0141 GMT, corn was up 8.5 per cent at $5.73-¼ a bushel.

The USDA pegged the 2010/11 corn crop at 12.664 billion bushels, based on the average projected yield of 155.8 bushels per acre - well below the average analyst estimate of 12.960 billion bushels in production and 160.0 bushels per acre in yield. With high demand, the corn surplus will shrink to 902 million bushels by the end of this marketing year, the smallest since 883 million in 1996/97. Soybeans futures also raced higher after the USDA cut its crop forecast by 2 per cent. CBOT November soybeans rose 3.3 per cent to $11.72-¼ a bushel, after rising as high as $11.84-¾ earlier, their loftiest since August 13, 2009. CBOT December wheat rose 1.2 per cent at $7.27-½ a bushel, off a high of $7.39-¾ earlier, a three-week high.