What Traders are Talking About:
* China signs soybean deals; more likely today. A delegation of Chinese officials signed purchase agreements for 8.62 MMT of U.S. soybeans in Des Moines, Iowa, yesterday. Additional agreements are expected to be signed in Los Angeles today that will push the total above 12 MMT (441 million bushels). On this trade mission last year, China signed purchase agreements for 11.5 MMT (423 million bu.) of U.S. soybeans. Talk ahead of the Chinese visit was that the volume of purchase agreements would be slightly less than year-ago.
The long and short of it: These are "goodwill" purchase agreements -- no price or shipment details have been arranged. And obviously, these agreements represent just a fraction of the total volume of soybeans China will ultimately buy from the United States.
* Competition for U.S. corn sales to China. Argentina and China finalized phytosanitary agreements that will allow Argentina for the first time to sell corn and corn products to China. The agreements were reached ahead of the new-crop harvest in Argentina, prompting some to believe there will be a quick start to trade between the countries. But there are some hurdles. Argentina's government controls corn shipments out of the country and have been slow to issue export permits in the past. It's not certain how or if this will change with China. Also, Chinese firms are likely to buy small "trial" batches of Argentine corn at first, according to Asian traders, since they are not familiar with the quality and shipments must pass through Chinese inspections before being allowed in the country. And most importantly, Argentine prices are no better than U.S. corn prices at this time, so there's currently no advantage to buying Argentine supplies.
The long and short of it: The news is more psychologically negative for the corn market than it is fundamental-changing -- at least for now.
* Greek concerns rise. European Union finance ministers have pushed back a decision on whether to award Greece 130 billion euros ($170 billion) in bailout funding the country needs to avoid defaulting on debt obligations. While Greece's top leaders have promised the country will adhere to stringent austerity measures it was required to pass in order to get the second batch of bailout funding, EU leaders aren't so sure as political wrangling continues. Greece must repay 14.5 billion euros of debt on March 20, which it cannot do without the help of the EU/IMF aid. There are reports of a possible delay to Greece's second bailout package until after the country's general election in April. To keep Greece from defaulting on March 20, a bridge loan is a possibility.
The long and short of it: Most expect that Greece will eventually be awarded the bailout funding, but the moments leading up to that decision are likely to be unnerving for markets.
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