By SANDY SHOREAP Business Writer
The price of corn surged 5.6 percent Friday after the U.S. estimated that supplies hit their lowest level in eight years.
The U.S. Agriculture Department said corn in storage from the 2011 harvest totaled 988 million bushels on Sept. 1, which was 12 percent less than the previous year. About one-half of this year's crop is in poor to very poor condition as the harvest nears its halfway point.
Global corn supplies are tight because of a devastating U.S. drought and poor harvest earlier this year in South America. Inventories will increase slightly after this year's harvest but so will demand, predicted Northstar Commodity analyst Jason Ward.
Corn for December delivery rose 40 cents to end at $7.5625 per bushel. The grain rose 19 percent for the third quarter ending Friday.
Commodities posted strong gains for the July-through-September quarter as traders bet on a healthier global economy. The U.S. and European central banks have taken steps to try to boost growth. Similar action is expected soon from China. Stronger growth will improve demand for commodities.
Gold and silver prices rose as investors bought contracts as a hedge against inflation. Other commodities benefited from hope that the stimulus measures will strengthen demand.
In Friday's trading, gold for December delivery rose $6.60 to finish at $1,773.90 per ounce. The price gained 10.6 percent in the third-quarter, its strongest showing by percentage since the second quarter of 2010.
December silver fell 8.9 cents to end at $34.577 per ounce, which marked a third-quarter gain of 25 percent.
October platinum rose $19.40 to $1,655.30 per ounce. The price increased nearly 15 percent during the quarter as labor unrest in South African mines created supply disruptions. December palladium rose $5.40 to $640.80 an ounce, up 9.6 percent in the quarter.
December wheat rose 47 cents to finish at $9.025 per bushel, up 19 percent in the quarter. November soybeans increased 30.25 cents to $16.01 per bushel. The price rose 12 percent in the quarter.
In energy trading, benchmark oil rose 34 cents to $92.19 per barrel Friday. Heating oil rose 1.21 cents to $3.1694 per gallon, wholesale gasoline increased 19.77 cents, or 6.3 percent, to $3.342 per gallon and natural gas gained 2.3 cents to $3.32 per 1,000 cubic feet.
Copyright 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.