News
01.02.2010
Corn, Wheat Advance on Signs Recent Slump May Attract Importers
Corn and wheat advanced, paring weekly losses on speculation their decline to three-month lows is attracting importers of U.S. supplies.
Corn for March delivery gained 0.3 percent to $3.6275 in after-hours electronic trading on the Chicago Board of Trade at 9:39 a.m. Singapore time, extending yesterday’s 1 percent advance. March-delivery wheat climbed 0.2 percent to $4.88 a bushel after closing 0.7 percent higher yesterday.
Export sales of wheat in the U.S., the world’s biggest shipper, totaled 660,746 metric tons in the week ended Jan. 21 the U.S. Department of Agriculture said yesterday. Analysts surveyed by Bloomberg News had expected 200,000 tons to 700,000 tons. Export sales of corn increased 20 percent during the four weeks ended Jan. 21, compared with a year earlier, the USDA said.
The bounce in prices “is a response to some encouraging export numbers that we got yesterday,” Toby Hassall, a research analyst at CWA Global Markets Pty, said by phone from Sydney today. “Perhaps there is some buying going on because of their expectations that the recent declines are going to uncover additional demand for these grains.”
March-delivery corn futures yesterday fell as low as $3.5775, the lowest price for the most-active contract since Oct. 7, before closing higher. Today’s gains pared the weekly loss to 0.6 percent and this month’s slump to 13 percent.
Wheat for March delivery yesterday fell to $4.8275 a bushel yesterday, the lowest price for the most-active contract since Oct. 12, before closing 0.7 percent higher. The contract has shed 2.1 percent this week and 10 percent this month.
Global Harvest
Gains may be capped by concerns that global grain output may exceed demand, Hassall said. “Overall, there’s still a negative bias to the grain markets at the moment,” he said.
The global grains harvest will be 1.77 billion tons in the year through June, higher than a November estimate of 1.76 billion tons, the International Grains Council said Jan. 21. The increase reflected higher wheat, corn and barley output in North America and countries of the former Soviet Union.
Soybeans for March delivery gained 0.5 percent to $9.36 a bushel at 10:06 a.m. Singapore time, paring the weekly loss to 1.6 percent and the monthly decline to 11 percent.
The oilseed yesterday plunged to $9.21, the lowest price for the most-active contract since Oct. 8, before closing 0.3 percent higher at $9.3175.
The soybean crop in Argentina is 99.9 percent planted and its corn crop is 99.8 percent planted, the Buenos Aires Cereals Exchange said yesterday. Argentina is the world’s third-largest soybean and corn exporter, according to the USDA.
“As we see more of the South American production come online, the market dynamic is certainly changing into a supply- led bearish period,” CWA’s Hassall said.
Bloomberg
