(Bloomberg) - Gold buys more corn, soybeans and wheat than ever, a sign that developing nations including India and China should boost food reserves rather than bullion as a hedge against inflation, said Dale Durchholz at Agrivisor LLC.

The CHART OF THE DAY shows the amount of crops that can be purchased for the cost of gold more than doubled from two years ago, when food prices surged amid shortages and riots. The metal has rallied for nine straight years, touching a record $1,227.50 an ounce in December as investors sought an alternative to currencies and a hedge against rising raw-material costs.

“Corn, wheat and soybeans are dirt cheap relative to gold,” Durchholz, the senior analyst, said from Bloomington, Illinois. “Gold is telling us that the economies in India, China and other emerging nations are growing, increasing demand for the metal. If economic growth is improving, then it follows that demand for food will also grow.”

An ounce of gold (31 grams) buys 306 bushels (7.77 metric tons) of corn, up from 116.5 bushels when the grain rose to a record in June 2008. The same amount of the metal is enough for 118.8 bushels (3.22 tons) of soybeans, up from 57 bushels when the oilseed touched the highest price ever in July 2008, and would buy 230.5 bushels (6.27 tons) of wheat, compared with 71.2 bushels in February 2008, when the grain reached a record.

Gold became an alternative currency after governments spent billions of dollars, euro, yuan and rupees to end the longest global recession since the 1930s, Durchholz said. The metal also is a store of wealth for the average citizen in India, China, parts of Asia and the Middle East, he said.

“Gold is not going to decline because it is now a fiat currency and a hedge against inflation,” Durchholz said. “A lot of people investing in commodities are going to start looking at how much grain prices are undervalued relative to gold and other precious metals.”