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COMMODITIES : Foreign Demand Up; Grain, Soybeans Gain

From Associated Press

Grain and soybean futures rose moderately Thursday for the third straight day on the Chicago Board of Trade because of what brokers called real and rumored improvements in foreign demand.

On other markets, sugar futures were sharply higher; stock index futures fell; energy, precious metals, livestock and meat futures were mixed.

Corn and soybeans led the crop futures higher on persistent rumors of large overnight purchases by the Soviet Union, analysts said.

The Soviets were said to have bought 1 million metric tons of U.S. corn, 500,000 metric tons of Argentine corn and an undetermined amount of U.S. soybean meal, analysts said. Corn and soybean meal can be used as cattle feed.

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After Thursday’s close, the Agriculture Department reported that private exporters had sold 100,000 metric tons of corn to the Soviets and more than 250,000 metric tons of corn to unknown destinations.

Feeling of Optimism

A metric ton is about 2,205 pounds and equals 39.4 bushels of corn.

Analysts have been expecting a resurgence of Soviet buying on world grain markets.

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“The rumors continue to be optimistic about Soviet purchases--there’s a general feeling of optimism there,” said Jerry Gidel, an analyst in Chicago with the G. H. Miller division of British-owned LIT America Inc.

Prices opened higher and remained near their opening levels until shortly before the close, when they retreated slightly on profit taking. Wheat steadied on late news of a new Chinese bid for U.S. wheat under the USDA’s export enhancement program.

Wheat settled 0.50 cent to 3 cents higher, with the contract for delivery in September at $3.9975 a bushel; corn was 0.75 cent lower to 6 cents higher, with September at $2.89 a bushel; oats were 3.75 cents to 6 cents higher, with September at $2.6025 a bushel; soybeans were 1 cent lower to 14.5 cents higher, with September at $8.69 a bushel.

Sugar futures soared while cocoa futures fell sharply on New York’s Coffee, Sugar & Cocoa Exchange.

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The sugar rally primarily stemmed from internal market supply and demand. But prices also advanced on rumors, later denied, of Chinese buying, as well as the price gains in grain.

Cocoa Futures Weaker

“The grains were up today and maybe they were in tandem, in lock step to some degree,” said Judith Ganes, an analyst in New York with Shearson Lehman Hutton Inc.

Sugar was 0.31 cent to 0.84 cents higher, with October at 10.64 cents a pound.

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The continued weakening of cocoa futures reflected growing pessimism about the survival of the International Cocoa Organization and its price support efforts in the face of huge cocoa surpluses.

Cocoa settled $33 to $47 lower, with September at $1,187 a metric ton, a 12 1/2-year low.

Stock index futures retreated on the Chicago Mercantile Exchange in reaction to a sharp decline in the Japanese stock market and weak bond markets, analysts said.

The contract for September delivery of Standard & Poor’s 500-stock index settled 2.80 lower at 258.80.

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Energy futures finished mixed in extremely light, directionless trading on the New York Mercantile Exchange.

Gold Retreats

West Texas Intermediate crude oil settled 7 cents to 12 cents lower, with October at $15.08 a barrel; heating oil was 0.11 cent lower to 0.14 cent higher, with October at 43.46 cents a gallon; unleaded gasoline was 0.27 cent lower to 0.36 cent higher, with October at 44.71 cents a gallon.

Gold futures ended modestly lower, while silver advanced slightly in a quiet session on New York’s Commodity Exchange.

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Gold settled $1.20 lower across the board, with October at $432.90 an ounce; silver was 1 cent to 2.5 cents higher, with September at $6.574 an ounce.

Cattle futures prices fell on mostly technical factors, while pork futures advanced after three days of sharply lower prices.

“I think they’re just taking a breather, to tell you the truth,” said Michael Murphy, livestock market analyst with Dean Witter Reynolds Inc. in Chicago.

Live cattle were unchanged to 0.67 cent lower, with October at 71.10 cents a pound; feeder cattle were 0.65 cent to 1.03 cents lower, with September at 81.05 cents a pound; hogs were 0.10 cent to 0.68 cent higher, with October at 38.85 cents a pound; frozen pork bellies were unchanged to 0.25 cent higher, with February at 49.07 cents a pound.

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Tables, Page 8


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