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CME: Corn Futures Finish Down Thursday

21 September 2012

US - December Corn finished down 10 1/2 at 746, 11 1/2 off the high and 7 up from the low. March Corn closed down 9 1/4 at 749 1/2. This was 7 up from the low and 10 1/4 off the high.

Corn traded lower into the close and fought off a significant amount of pressure from a sharply lower soybean market. Support from the wheat market helped to stabilize. Corn basis in the Gulf of Mexico was steady midday but bear spreading in calendar spreads along with good weather for harvest added to the negative tone. Technical selling and negative outside markets also added to the weak tone throughout the day. The weekly export sales report was disappointing for the bull camp with net weekly export sales coming in at 69,900 tonnes for the current marketing year and none for the next marketing year. Sales of 429,000 tonnes are needed each week to reach the USDA forecast. Traders noted that US corn remains expensive relative to South American and Ukrainian corn which may have added to the weaker trade. The US Dollar traded higher on the day and most commodity markets were lower after poor economic data was released by China and Europe overnight.

November Rice finished up 0.07 at 15.19, equal to the high and 0.11 up from the low.

Soybean

November Soybeans finished down 50 3/4 at 1618 3/4, 67 1/4 off the high and 2 3/4 up from the low. January Soybeans closed down 51 1/2 at 1617 3/4. This was 2 3/4 up from the low and 67 3/4 off the high. December Soymeal closed down 17.2 at 483.1. This was 1.3 up from the low and 23.6 off the high. December Soybean Oil finished down 1.2 at 55.05, 1.53 off the high and 0.31 up from the low.

November soybeans were trading 20 cents lower midday but late session technical selling and profit taking took the market nearly 3% lower. Bear spreading was noted throughout the day. Seasonal harvest pressure along with reports of better than expected soybean yields continue to give a negative tilt to the soybean market. Long term support may come from the stunning export pace for the 2012/13 marketing year but the market is focused on harvest at the moment. The weekly export sales report for the week ending September 13th pegged sales for soybeans at 712,200 tonnes for the current marketing year and 5,500 for the next marketing year for a total of 717,700. Total sales were in line with market estimates. As of September 13th, cumulative soybean sales stand at 75% of the USDA forecast for current marketing year vs. a 5 year average of 38%. Total net soybean meal sales came in at 234,300 tonnes and total net oil sales came in at 36,300 tonnes. The US Dollar traded higher on the day which added to the negative sentiment after China and Europe released poor economic data overnight.

Wheat

December Wheat finished down 2 at 879 1/2, 14 1/4 off the high and 10 1/2 up from the low. March Wheat closed down 2 1/4 at 891 1/2. This was 10 1/2 up from the low and 13 3/4 off the high.

December Chicago wheat traded mixed today seeing support from dry weather in Australia and areas of the western US plains. Pressure from a sharply lower soybean market limited gains. The wheat market brushed off the weak corn and soybean market on thoughts that Russia will begin to slow its export pace in October and on dry weather in Australia. Russia continues to undercut the global market with cheap wheat which has hampered the sales pace of other major exporters. The European Union granted export licenses for 391,000 tonnes of soft wheat taking the total for 2012/13 to 2.9 million tonnes vs. 3.15 million for the same time last year. In addition, the Moroccan government released a statement saying that they would reduce import duties to zero for soft wheat to ensure domestic supplies were adequate. The pace of US exports remains sluggish due to the uncompetitive nature of our prices however sales for the week ending September 13th fell in line with market estimates and was pegged at 488,900 tonnes vs. 382,000 last week. As of September 13th, cumulative wheat sales stand at 38% of the USDA forecast for current marketing year versus a 5 year average of 50%.

December Oats closed down 2 1/2 at 373 1/4. This was 3 3/4 up from the low and 8 1/4 off the high.


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