Markets Continue to Drift Lower Overnight
Dec 16, 2013
Grains were lower overnight with corn hitting a two-week low, giving up 4 cents. Beans and wheat were also lower, losing 6 and 4-cents respectively.
Corn continues to be pressured by concerns that China will continue to shun US corn imports after blocking three US cargoes found to have non-approved GMO traits. On Friday, it was announced Secretary of Agriculture Tom Vilsack will lead a team of senior U.S. officials and farm industry leaders attending annual trade talks with Chinese officials next week in Beijing, with recent rejections of U.S. corn shipments to be among the topics discussed.
For beans, Monday brings fresh demand data with NOPA’s November crush report. Analysts look for a crush number of 161.3 MB with a range of 157.5 to 170 MB. If realized, the trade estimate of 161.3 MB would represent the biggest November crush on record and the third largest for any month in NOPA records dating to the start of 2002. The record high was 164.377 MB from Dec 2009. On the export front, US export business continues to hold a healthy lead over the pace needed to reach USDA’s annual forecast. But, whether it can persist with a record-huge South American crop seems unlikely.
Overnight, Australian wheat was offered at the lowest price of $339.70 a MT in Iraq’s tender to purchase a minimum 50,000 MT of milling wheat . The lowest offer for U.S. wheat was $358.87 and Canadian wheat at $361.05 a MT. On the other end of the wheat quality spectrum, India sold wheat at $281.5 MT, higher than the government's new floor price of $260. The latest tender is part of the Indian government's plan to sell 2 MMT of the grain overseas until March to cut its large stockpiles. Russia’s Ag Minister is looking to target a 2014 grain crop of 95 MMT, up from a previous target of 90 MMT. The new forecast includes 55 MMT of wheat for 2014, higher than USDA’s 2013 forecast of 51.5 MMT.