March 4 (Bloomberg) -- Soybeans rose the most in more than three weeks and corn gained on speculation that demand for food and livestock feed will improve as China boosts government spending in a bid to spur economic growth.
Premier Wen Jiabao will announce a new stimulus package tomorrow, said Li Deshui, a former central bank policy maker. China’s manufacturing index rose for a third month in February, adding to evidence that spending is reviving growth. The country is the world’s biggest consumer of grain and oilseeds.
“China’s economy looks like it is moving back into an expansion mode,” said Roy Huckabay, an executive vice president for the Linn Group in Chicago. “A controlled economy like China can turn around much faster than a free-market economy.”
Sovereign-Fund Buying
China Investment Corp., the $200 billion sovereign wealth fund, may invest in “undervalued” commodity assets, joining other Chinese companies in taking advantage of a six-year low in prices, Executive Vice President Jesse Wang told reporters today in Beijing.
The Baltic Dry Index, a measure of shipping costs for commodities, posted a fourth consecutive advance on the Baltic Exchange, suggesting improved commodity demand, analysts said. The index, after dropping 92 percent last year, has more than doubled since Dec. 24.
“The jump in the shipping index is a sign that China is again restocking natural resources,” Linn’s Huckabay said. “This could be a signal for other countries to start buying, and that means U.S. grain exports may be better than people expect.” more...
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