May corn was trading 3 1/4 cents lower late in the overnight session. Outside market forces look negative with a surge up in the US dollar and weakness in metal, energy and equity markets. Fears that corn usage for ethanol will continue to slip and help offset better than expected exports plus the overbought condition of the market are seen as short-term negative forces. Unknown demand from China and uncertain weather for the US and China this season has helped to provide underlying support. The founder of China's largest private Agricultural business believes the country should liberalize the corn trade as the import quota system seems too restrictive and feedgrain demand continues to grow with expanding livestock. He believes the country should distinguish between food and feed grain and more fully open up feedgrain with the goal of producing more meat internally. The Buenos Aires Grains Exchange pegged corn production at 21.3 million tonnes as compared with the last USDA forecast of 22 million tonnes which was down from a 26 million tonne estimate in January. May corn closed moderately lower on the session yesterday but near the middle of a choppy trading session. Traders suggested that the selling may have been profit-taking from funds and specs. Uncertainty with the outside market forces plus more talk that the market is in a short-term overbought condition after following soybeans higher recently helped trigger some fund trader selling. Weekly export sales for corn came in at 690,000 metric tonnes for the current marketing year and 23,000 for the next marketing year for a total of 713,000 which was a little below trade expectations. However, China was included as a buyer of 122,000 tonnes of the total and reports that Argentina is unlikely to be an aggressive seller to China until later this year were factors which helped to support. As of February 23rd, cumulative corn sales stand at 71.5% of the USDA forecast for 2011/2012 (current) marketing year versus a 5 year average of 66.6%. Sales of 452,000 metric tonnes are needed each week to reach the USDA forecast. Brazil exported 279,200 tonnes in February from 852,500 tonnes in January and 553,300 tonnes last year. Traders see the USDA in a position to raise export projections in the supply/demand report for next week by about 50 million bushels which could tighten ending stocks further. There have been no deliveries for the first three days of the delivery period for March corn.