As of last week corn prices in China had surged to new all-time highs just north of $10.00. Meaning domestic Chinese corn was trading at just over $390 per ton. US corn on there on the other hand (reported by most cash sources) is trading at round $265 per ton. Delivered to the dock, or what many call the landed cost of US corn in China is said to be running about $340 per ton. As you can see, with US corn being cheaper than domestic Chinese corn, every "buying" rumor started is extremely hard for the bears to dispute considering the possibilities. There is some propaganda starting to circulate in the trade however that shows US corn prices trading at a significant premium to corn out of Argentina and Brazil and much higher than corn out of Ukraine. My point is, even though there is a "Smoking Gun" in China, they may be eyeballing or waiting on some other alternatives. Don't fool yourself into believing we are the ONLY game in town. I am still not 100% sold on the "old" crop premium and continue to encourage producers to take advantage of the premium in Sept when making "new" crop sales.
Wheat has picked about $0.30 cents in the past couple of weeks as there continues to be some moderate weather concerns both here int eh US and globally. US wheat continues to remain highly competitive in the global marketplace, and there is starting to be more talk in the trade about the upcoming USDA report showing a much larger wheat "feeding" number. Net-net, despite a glut of world supplies there should be enough bullish news (at least short-term ) to help keep wheat prices somewhat supported through the end of March. Dry conditions in Western Europe continue to be monitored, as well Black Sea wheat becoming more readily available and possibly more competitive in the days and weeks ahead. I continue to look for strong upside resistance in the $6.80 to $6.90 range, and would be thoroughly surprised to see us break through these levels without some very serious "weather" related premium being added.