STRONG CASH..................... Thursday's weekly export sales report showed 836 t.m.t. of corn was sold last week, up from 455 the week prior and 743 on our solid four week average. No Chinese purchases but Mexico was in for 222 t.m.t. and in for the 15th consecutive week. Rumors of China in buying or set to buy, surfaced almost everyday. There's talk China's corn reserves have been depleted and with the drought in number two world producer exporter Argentina ,most feel China need to purchase US corn sooner than later. If the Argentine government decides to suspend indefinitely corn exports we should expect a $.50-$.75 gain in futures on anticipation of exports here increasing. Argentina is looking deeply at this year's crop to see what the harvest may really be as they need about 8 million metric tons to meet domestic needs and don't want to over export and fall short such as Russia did on their wheat drought that left them short of needs to meet their own demand, creating strong price inflation and civil protests. Bean exports were 609 t.m.t. for current crop year delivery prior to September 1. This was under the week prior, but China was in for 368 of the total and further shows China feels South America can't meet their near-term needs as normally they would be all over Brazilian ports buying especially with over half their crop harvested. The issue getting a lot of attention is next year's new crop year exports for September 1, 2012 into 2013. Thursday's export report showed 669t.m.t. were sold to China for September 1 on out delivery. This has been the case lately, as were seeing good current crop of year and new crop year purchases by China. Our March 9 USDA monthly crop report put next year ending stocks at 205 million bushels from 275 this year. Traders are thinking that next years ending stocks are heading significantly lower on demand due to lower South American production and potential for less acres to be seeded here this spring. Our government here has made an effort to hold the line of old crop exports to keep from running out and pushing exports forward. This forward selling started last spring and all that forward selling comes to a head in 2013 with potentially one of the smallest ending stocks inventory on record. The March futures expired this week making may the front month. With Midwest temperatures all next week over 70° we look for farmers to be in the fields turning soil and applying chemicals. This looks to further push cash corn and bean prices higher and further drain the pipeline of grain coming to export ports. Farmers are too busy to move grain. Strong cash prices, the ongoing battle for acres with price gains and fear the March 30 planted acres report won't show enough to be planted to build safer inventories, all lead to higher prices this next week. Technicals read like this. May corn support is 6.60 then 6.50 with resistance 6.84. May bean support is 13.55 then 13.35 with resistance. 13.75 then 13.50. May wheat support is 6.40 with resistance 6.70 then 6.90.
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