CHICAGO -- U.S. soy futures gained four percent Monday and corn edged up about one percent as the two crops lock horns and battle for 2009 U.S. crop acreage.
Grain markets also were lifted by fresh optimism about the global economy which was triggered by gains in the U.S. stock market for the fifth day in a row.
"They're trying to be optimistic that the stock market has bottomed out," said Paul Haugens, vice president for Newedge USA.
The Dow Jones Industrial average was up over one percent on Monday and has now soared about 13 percent from its 12-year low that was set on Friday.
"Weakness in the dollar and strength in financial markets are the primary drovers of ag markets, followed by bean/corn spreading," said Terry Reilly, analyst for Citigroup.
Fears of a prolonged global recession and associated loss of demand for grains and soy had been weighing on soy, corn and wheat futures markets.
Wheat leaped over 5 percent, finding independent strength from drought stress in key portions of the U.S. winter wheat crop.
"It looks stressful with warmer temperatures and little rainfall for the next seven days...especially in the west," said Mike Palmerino, DTN Meteorlogix forecaster.
Reilly said, "the extremely dry weather and weather outlooks that called for continued dryness over the next 7 to 10 days" boosted the wheat market.
Soy for May delivery was up 34-1/2 cents at $9.11 per bushel, May corn was up 3 cents at $3.91-1/2 and wheat for May was up 26 cents at $$5.44-1/4 per bushel.
Forecasts from Informa Economics on Friday triggered a reaction late last week on corn and soybean prices and markets continued to react early this week.
The widely watched consultant pegged U.S. corn seedlings at 81.4 million acres , down 5 percent from last spring, and soybeans at an all-time high of 81.5 million acres, up nearly 8 percent.
"Corn needs to maintain its relationship with beans. They traded the Informa numbers last week," a trader said.
The figures helped push corn higher and soybeans lower at the close in Chicago on Friday.
"The March 31 report will keep our attention," he said.
On March 31, the U.S. Department of Agriculture (USDA) will release its hotly anticipated plantings forecast for this year's U.S. corn and soybean acreage.
At its annual outlook conference in February, the USDA projected 2009 U.S. corn area at 86 million acres, about the same as a year ago and estimated soy acreage at 77 million, up from 75.7 million last year.
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