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CME: Corn Futures Closed Unchanged Tuesday

10 October 2012

US - December Corn finished unchanged at 742, 6 1/2 off the high and 1 3/4 up from the low.

March Corn closed up 1/4 at 742 1/4. This was 2 up from the low and 6 1/4 off the high.

December corn ended the day nearly unchanged. After trading higher for most of the afternoon, sell pressure at the close pushed December corn near its lowest level of the session and closed just off the lows.

Some in the trade believe current price levels in corn are rationing demand which could limit the long term price outlook.

US corn export inspections for the week ending October 4th were reported at 17.4 million bushels vs. 20.2 the week prior. Inspections of 25.30 million bushels are needed each week to reach the current USDA forecast.

Export demand remains sluggish for US corn as South American supply trades at a steep discount. The Brazilian government pegged their corn crop for 2012/13 at 73.2 million tonnes vs. 72.6 in 2011/12.

Early support in corn was seen after a private analyst in Ukraine cut Ukraine's estimated corn production to 21 million tonnes vs. 25-27 million tonnes previously.

Some commodity markets turned sour this morning after the IMF announced a downward revision in their global growth forecasts. The US Dollar moved sharply higher on the news which kept gains limited for the remainder of the day.

Wheat Futures Closed Slightly Higher

December Wheat finished up 3 1/4 at 864 1/4, 9 1/2 off the high and 4 1/2 up from the low. March Wheat closed up 4 1/2 at 875 3/4. This was 5 3/4 up from the low and 8 off the high.

December Chicago wheat ended the day in positive territory and traded higher throughout the session. KC and Minneapolis wheat followed higher. Support in wheat came from private forecasts that pegged Australian wheat production near 20-22.5 million tonnes vs. the current USDA estimate of 26 million tonnes.

Additional upside momentum was added after the Russia Agriculture Minister revised his estimate of their wheat crop to 40 million tonnes vs. previous forecasts of 40-42 million tonnes.

The exportable surplus of wheat for Russia is estimated at 10 million tonnes vs. previous government estimates of 10-12 million tonnes. Syria issued a tender to buy 100,000 tonnes and Morocco is expected to come to the market soon as well.

Export inspections for the week ending October 4th were reported at 13.2 million bushels vs. 24.5 last week and were below trade estimates. Inspections need to average 24.2 million bushels each week to reach the current USDA export forecast.

Outside markets added pressure throughout the day with US stocks trading lower and the US Dollar sharply higher.

Soybean Futures Closed Mixed

November Soybeans finished down 1 at 1550, 24 off the high and 3 up from the low. January Soybeans closed up 1 1/4 at 1549 1/4. This was 5 1/4 up from the low and 22 1/4 off the high.

December Soymeal closed down 1.6 at 471.0. This was 0.6 up from the low and 7.7 off the high.

December Soybean Oil finished up 0.32 at 51.25, 0.73 off the high and 0.32 up from the low.

November soybeans traded lower into the close and nearly 25 cents off its highs of the day.

Soybean meal ended the day lower but soybean oil was able to hold onto gains and finish higher on the day.

Early support was linked to rumors that China bought US soybean cargos off the PNW coast overnight but no reported sales have hit the market yet.

Soybean basis was steady to slightly firm in certain areas of the Midwest as harvest moves along and most feel soybean harvest will be reported at 61% complete this afternoon.

Additional support is coming from a robust US export program and export inspections for the week ending October 4th were reported at 45.6 million bushels vs. 41.7 last week. Only 20.8 million bushels are needed each week to reach this year's USDA forecast. The export pace is running 11% of the current USDA estimate vs. the 5 year average of 6%.

A brief period of sell pressure hit the market midday after Brazil's government reported that its current Brazil soybean production estimate for 2012/13 is 82.8 million tonnes which would be the largest crop on record.

Outside markets were mixed on the day with crude oil trading higher, US stocks lower, and the US Dollar was sharply higher which limited gains in the soybean market.

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