U.S. Corn and Soybeans futures increased following an increase in demand for the grain in overseas nations, driven by the declining shipping costs.

Corn exports by the U.S., the world's largest producer, increased by 33 from last year compared with 15 percent forecasted by the U.S. Department of Agriculture (USDA).

Sales for soybean increased by 0.8 percent compared with a decline of 11 percent for the marketing year forecasted by the USDA.

Corn futures for March delivery increased by 6.25 cents, or 1.3 percent, to $5.0675 a bushel on the Chicago Board of Trade.

Last year, corn prices made a record gain, reaching $5.1925 on Jan. 15 boosted by demand for ethanol and livestock feed.

Soybean futures for March delivery increased by 21 cents, or 1.6 percent, to $13.0825 a bushel.

In the past 12 months, soybean prices increased by 78 percent reaching a record high of $13.415 on Jan. 14 after farmers planted few acres of soybeans.

The cost of shipping commodities from the U.S. to other importing nations was reduced after the Baltic Dry Index of shipping costs for commodities declined by 40 percent.

According to the U.S. Department of Agriculture, U.S. exporters made sales of 121,920 metric tons of corn to Japan before Aug. 31 and posted the highest sales by Jan. 24 of 46.3 million metric tons.

U.S. government figures showed that corn is the largest U.S. crop, valued at a record $33.8 billion in 2006 followed by soybeans at $19.7 billion.