March corn traded slightly lower into the closing bell after disappointing export data was released this morning. Inspections were only 5.3 million bushels, down sharply from 21.1 million the week prior.
Shipments needed each week to reach the USDA export estimates are now 21 million bushels, up from 20.50 the week prior. The cumulative shipment pace is now 33 per cent of the USDA export estimate vs. the 5 year average of 40 per cent.
The sluggish sales and shipment pace continues to suggest demand has been rationed in this area of the balance sheet but many questions remain as to how much corn the domestic market is using for feed which is adding support.
The Argentina weather forecast was supportive this morning after weekend rainfall came in below market estimates. The 5 day precipitation outlook is dry which added risk premium to the market.
Thoughts that Argentina production could be slashed on this Friday's USDA Supply and Demand report added a bullish tilt to the trade but weakness in the wheat market limited gains.
March Rice finished up 0.35 at 15.91, equal to the high and 0.28 up from the low.
Soy Futures Closed Higher
March Soybeans finished up 12 1/4 at 1486 1/2, 11 1/2 off the high and 11 up from the low. November Soybeans closed up 11 1/2 at 1344. This was 10 up from the low and 6 3/4 off the high.
March Soymeal closed up 6.1 at 434.3. This was 6.2 up from the low and 3.7 off the high.
March Soybean Oil finished up 0.12 at 53.11, 0.43 off the high and 0.05 up from the low.
March soybeans saw double digit gains into the closing bell on supportive demand data and a less than ideal weather forecast in Argentina.
The USDA reported this morning that US private exporters sold 116,000 tonnes of soybeans to China, included in that total was 58,000 tonnes for the 2012/13 marketing year and 58,000 tonnes for the 2013/14 marketing year.
Additionally, export inspections were positive to market sentiment at 53.9 million bushels vs. 40.7 the week prior. Only 11.2 million bushels are needed to ship each week to hit the current USDA forecast.
The cumulative shipment pace is now 75 per cent of the USDA export estimate vs. the 5 year average of 58 per cent. The explosive sales and shipment pace continues to send positive vibes through the market but early gains were linked to unimpressive weekend rainfall in Argentina and a dry outlook for this week.
Crop analysts are beginning to trim Argentina soybean production for this year but most continue to be upbeat on the Brazilian outlook with some estimates as high as 85 million tonnes while others are coming in between 81-82 million tonnes. The USDA is currently estimating production at 82.50 million tonnes.
Wheat Futures Finished Lower
March Wheat finished down 2 at 763, 11 off the high and 2 up from the low. May Wheat closed down 2 1/2 at 770 3/4. This was 2 up from the low and 11 off the high.
KC and Chicago wheat traded lower into the closing bell on weak export demand data which favored the bear camp.
Grain inspections failed to impress the market and shipments for the week ending January 31st were pegged at 15.2 million bushels vs. 22.3 the week prior.
Shipments needed each week to reach the USDA export estimates are 26.1 million bushels, up from 25.5 the week prior.
The cumulative shipment pace is now 57 per cent of the USDA export estimate vs. the 5 year average of 65 per cent.
The slow pace of sales and shipments is considered a negative to the price outlook and some suggest the USDA may cut export demand in this Friday's Supply and Demand report. As a result, the all wheat carryout is as risk of rising.
Additional pressure stemmed from a wetter forecast for the western plains and eastern Corn Belt over the next 2 weeks.
March Oats closed up 1/2 at 359 3/4. This was 1 1/4 up from the low and 5 1/4 off the high.
