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COMMODITIES-Gold hits new record, Brent oil above $122

* Gold hits record on inflation concern, Europe debt concern

* Silver hits 31-year high

* Strong commodity prices fuel inflation

* Corn dips but more gains seen, US supplies tightest since
1930s

* Brent above $122; Middle East, N.Africa turmoil supports

By Simon Webb
af.reuters.com

SINGAPORE, April 6 (Reuters) - Gold hit a record high on
Wednesday while oil and corn were just off peaks struck this
week as commodity prices fuel rising inflation that governments
worldwide are struggling to contain.

Spot gold rose to a record $1,458.50 an ounce as
investors bought the precious metal to hedge against inflation
and as a save haven as sovereign debt problems flared again in
Europe after Portugal's credit rating was downgraded.

Euro zone debt woes and continued unrest in the Middle East
and North Africa (MENA) have added to gold's attraction for
investors.

"You tend to get movements like this into gold and silver on
the type of risks we're seeing in the MENA region, and now the
flare up in Europe's sovereign debt issues," said Joel Crane, an
analyst at Morgan Stanley in Melbourne. "It's investors doing
what investors do."

Spot silver hit a 31-year high at $39.48 an ounce on
Wednesday, supported by gold's rally.

Economic growth in Asia and upheaval in North Africa and the
Middle East are stoking commodity prices, driving up the cost of
raw materials and energy to business and consumers. Inflation is
a threat to the growth of Asia's emerging economies, the Asian
Development Bank said in a report on Wednesday. [ID:nL3E7F519W]

"High and volatile oil and food prices will, in particular,
reverberate through the world economy, and they are likely to
stay that way in 2011-2012," the ADB said. "They will thus be a
significant source of global inflation, especially in developing
countries where recovery is firmly under way."

The ADB's comments contrasted with the dovish tone of U.S.
Federal Reserve Chairman Ben Bernanke, who said this week that
U.S. inflation was being driven by rising commodity prices
globally, and was unlikely to last long. [ID:nN04294041]

Benchmark U.S. corn futures Cc1 slipped 0.59 percent to
$7.62-1/4 a bushel at 0800 GMT. The contract hit an all-time
peak of $7.70-3/4 on Tuesday, after rallying 15 percent in four
days on a U.S. government report showing unexpectedly low
inventories.

Supplies in the U.S. are at their tightest since the 1930s,
and many in the market see more gains ahead unless livestock
farmers or ethanol makers cut back on purchases. With
inventories so thin, any sign of inclement weather impacting
crops or buying from China could trigger further rises.

"The top pick for us and a position we've had in our
portfolio for a long time is corn," said Colin O'Shea, head of
commodities at Hermes, which has $35 billion under management,
and around $2 billion in commodities and energy, speaking on the
sidelines of a conference in Singapore. [ID:nL3E7F612U]

Rising consumption in China brought it into the corn market
last year for the first time in four years, contributing to
corn's rise. The U.S. Grains Council said on Tuesday China could
import an additional 2 million to 3 million tonnes by September.
[ID:nN05129097]

Corn, like most other commodity markets, quickly shrugged
off China's interest rate hike on Tuesday, despite the threat
that tightening monetary policy could slow imports by the
world's biggest consumer of raw materials.

China has raised rates four times since October as it
battles to contain inflation and prevent its fast-growing
economy from overheating.

LME aluminium hit its highest since September on
Wednesday at $2,663 a tonne, helped by a weaker dollar versus
the euro.



OIL

Unrest in the world's top oil exporting region has roiled
oil markets this year and outweighed any concern of a slowdown
in the world's second largest oil consumer China.

Brent crude LCOc1 fell 9 cents to $122.13, after breaking
above $120 on Monday. The contract is within a dollar of
Tuesday's $122.89 peak --the highest since August 2008.

U.S. crude rose 14 cents to $108.48 a barrel, just 30 cents
below its highest since September 2008 of $108.78 hit on Monday.

Top oil exporter Saudi Arabia has stepped in to plug the
supply gap left by Libya, after civil war there interrupted
exports. The kingdom is the only producer with significant spare
capacity to compensate for unexpected supply losses.

The worst-case scenario for oil markets would be if unrest
constrained Saudi Arabia's output and spare capacity --
threatening not only the 10 percent of global oil supply the
kingdom provides, but also leaving producers with insufficient
spare capacity to meet any supply outage.

Oil prices could rocket to $200 per barrel to $300 per
barrel if Saudi Arabia is hit by serious political unrest,
former Saudi oil minister Sheikh Zaki Yamani told Reuters on
Tuesday. [ID:nLDE7340MU]

The 19-commodity Reuters-Jefferies CRB index , a
global benchmark for the asset class, rose 0.26 percent on
Tuesday, and is less than a percent off a 2.5-year high hit last
month.

(Editing by Clarence Fernandez)