Quick Update: USDA export sales data released this morning showed horrible sales numbers for corn, average numbers for wheat and numbers at the high end of the range for soybeans. There was an announcement after the numbers were released that South Korea Feedmillers agreed to buy 266,500 tons of corn at $299-$304.5/ton, C&F, so we are starting to see some corn buying interest creep back into the equation.
- Corn export sales reported at just 400 tons. The trade was looking for a number between 150,000 and 300,000. Last week 69,900 exports were reported.
- Soybeans export sales reported at 799,500. The trade was looking for a number between 600,000 and 800,000. Last week 717,800 exports were reported.
- Wheat export sales reported at 426,000. The trade was looking for a number between 400,000 and 550,000. Last week 489,000 exports were reported.
Corn bulls have to believe as prices continue to break there will be less farmer selling and more global interest in buying corn. Do you realize South American corn is not only about $30-40 per ton cheaper than US corn, but it is close to $60 per ton cheaper than US feed wheat. Asian buyers who had made the switch to wheat may soon be flipping back over to corn. One of the problems however is that US end-users are also highly interested in "cheap" South American corn supplies.
Hog producer Prestage Farms Inc and two other livestock companies in North Carolina have confirmed yesterday that they had inked deals to import some 750,000 metric tons of corn from Brazil in the wake of skyrocketing US prices. From what I understand, the imports were made through agribusiness companies such as Bunge and Archer Daniels Midland and are the largest imports of corn ever on record for the US. To be clear, we had rumors that livestock producers had likely purchased corn out of South America, but this is the first official confirmation that US companies were importing such a large amount of corn from Brazil. The USDA has set projections for US corn imports at a record 1.9 million metric tons in the marketing year ending August 31, 2013. Prestage, whose family company ranks among the top five US hog producers, said that as the weather turned hot and dry through the spring and summer, they started thinking about looking around for other sources of feed. From what I have heard, their corn is scheduled to arrive in some 15 cargo loads with about 50,000 metric tons each over the next six months, and the first is scheduled to arrive at the Port of Wilmington, North Carolina next week. Prestage has also said that they are exploring futures imports of soybean meal, but will wait to make anything official until after the first of the year. If you didn’t know, livestock and poultry producers in North Carolina normally rely heavily on rail shipments of feed grains from the Midwest. They said costs were nearly 5% lower to import corn from Brazil than to transport it from the Midwest.
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