March corn closed slightly higher on the day after holding onto overnight gains despite sharply lower equity markets and a stronger US Dollar.
Buying support was linked to more concern that Argentina corn production will decline due to rainfall this week. Conditions are expected to dry out into the weekend but more rainfall is expected for some areas next week. South Korea decided to include the US in their 210,000 tonne corn tender overnight.
The buyer purchased 193,000 tonnes to be sourced from South America or the US. China released trade data that showed November corn imports totaled 384,213 tonnes, up 57 per cent on the year and January through November imports are up a whopping 317 per cent on the year.
China corn imports are estimated at 2 million tonnes according to the USDA vs. 5.2 million for the 2011/12 season. The EU reported that 537,000 tonnes of corn import licenses were issued this week taking the crop year total to 4.5 million tonnes.
The USDA estimates EU imports at 8 million tonnes. Less than ideal weather conditions trimmed corn and wheat production from year ago levels which has tightened their domestic feed grain supply this year and forced additional imports.
January Rice finished down 0.07 at 15.205, equal to the high and equal to the low.
Soy Futures Closed Higher
January Soybeans finished up 22 at 1430 3/4, 8 off the high and 22 1/4 up from the low. March Soybeans closed up 24 1/2 at 1429 1/4. This was 24 3/4 up from the low and 5 1/2 off the high.
January Soymeal closed up 6.1 at 433.8. This was 6.2 up from the low and 3.0 off the high.
January Soybean Oil finished up 0.8 at 48.71, 0.29 off the high and 0.66 up from the low.
March soybeans saw double digit gains on the day and nearly retraced all of Thursday's losses to finish out the week of trading. Speculative buying showed up after sharp declines the last two days as traders evened up positions ahead of the weekend and Christmas next week.
China reported November import data overnight and total soybean imports were pegged at 4.16 million tonnes, down 27 per cent on the year but January through November imports were at 52.5 million tonnes, up 11.4 per cent on the year.
The slowdown in soybean imports for China in the month of November and the cancelations this week are both seen as short term negatives but overall demand remains robust.
South American weather looks mostly favorable over the next couple of weeks. Brazil will see showers across most growing regions but areas to the north may see drier conditions which the market will monitor closely.
Basis on the river and in the Gulf of Mexico had a softer tone yesterday but were steady today as water levels on the Mississippi River increased and on good supply at export terminals.
Interior basis levels had a firm tone to them as farmer sales shut off due to the slide in prices. The USDA made an announcement this morning stating that last week's 110,000 tonne soybean sale to an unknown destination was incorrect and that the tonnage was sold domestically.
Wheat Futures Closed Higher
March Wheat finished up 1 1/2 at 792, 6 3/4 off the high and 2 1/4 up from the low. May Wheat closed unchanged at 802. This was 1 1/4 up from the low and 7 3/4 off the high.
The Chicago and KC wheat markets traded higher for most of today's session but came under a bit of sell pressure in the last hour of trading to close off session highs.
Chicago wheat narrowed its premium to corn on profit taking and thoughts that the moisture seen this week in the eastern US will benefit the soft red winter wheat crop in the spring. Worries over the Fiscal Cliff, lower stocks, and a stronger US Dollar kept gains limited throughout the session.
European wheat markets were higher overnight after hitting a fresh 5 month low which helped to support the move higher early in the day. Dry weather in the western plains continues to provide underlying support to futures and maps show a chance for another round of light moisture by the middle of next week.
Accumulation is expected to be light and this week's Drought Monitor continues to show serious drought conditions persist across most of the Hard Red Winter wheat region.
Additional support stems from signs that export demand is beginning to show up for the US after sales beat market estimates yesterday and the US was able to sell Egypt wheat earlier this week.
Traders noted the higher trade was on light volume as the weekend and Christmas holiday approaches.
March Oats closed up 5 at 364 3/4. This was 11 1/2 up from the low and 1 1/2 off the high.
