U.S. rice futures rise over 2 percent
SYDNEY (Reuters) - July rice futures jumped by as much as 2.24 percent in electronic trade in Asia on Thursday, as soaring crude oil prices helped Chicago Board of Trade grains futures markets broadly extend gains.
July soybeans, corn, wheat and soybean oil were also higher.
Rice and soybeans opened strongly in Asian trading on Thursday as crude oil futures rose by a further 1.4 percent to more than $135 a barrel in Asia on Thursday, after setting new records in New York on Wednesday.
Oil price gains force up the price of corn, soybeans and soyoil, which are used as key feedstocks to produce fuel alternatives ethanol and biodiesel.
Rice is also affected as increased demand for biofuel feedstock in turn lifts demand for rice as a food source, and as farmers move from growing one crop to another to capitalize on yield differentials.
"The rise in crude is directly affecting ethanol and also affects all of the vegetable oils as well," a trader with a leading Sydney-based commodities brokerage said, asking that he not be identified.
Rice traders in the Philippines, the world's biggest importer of rice, said the oil price surge was adding to a price pressures caused by restricted supplies and strong demand.
"The rise in rice prices is not only because of the increase in the price of oil," said Chuck Gallardo, trader with Agri Multicom Trader, said by telephone from Manila.
After a roaring start, rice settled back slightly on Thursday to a gain of 1.9 percent to $20.935 a hundredweight by 0305 GMT.
An Iraqi tender for at least 30,000 metric tons of rice was bullish for markets, as was news that the Philippines was studying a plan to buy 300,000 metric tons of Thai rice, traders said.
"It drives the price up further," Gallardo said, adding that the Philippines planned to hold more tenders for rice.
The oil price rise also strengthened wheat futures prices on Thursday, reversing falls in Chicago on Wednesday caused by U.S. harvest pressure.
Wheat was up 0.32 percent at $7.81 a bushel by 0306 GMT, with concerns about the Australian crop still preoccupying the market, traders said.
July soybeans also opened strongly and were up 0.54 percent at $13.56-¼ a bushel by 0306 GMT.
July corn rose by 0.5 percent at the start, before settling back to a 0.29 percent rise to $6.09 a bushel by 0306 GMT.
Weather concerns continue to affect the corn market despite good recent planting progress, brokers said.
July soybean oil was more subdued in Asian trading on Thursday than in Chicago the day before, rising by 0.19 percent to 63.34 cents a lb by 0049 GMT before later easing back.
(Editing by Clarence Fernandez)
