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CME: Corn Futures Closed Lower Wednesday

14 March 2013

US - May Corn finished down 4 at 710 1/4, 7 1/2 off the high and 9 3/4 up from the low. July Corn closed down 1 1/2 at 692 1/4. This was 9 up from the low and 5 1/2 off the high.

May corn traded lower on the day and traders noted profit taking as the US Dollar put in a new high for the move early in the session.

Ethanol production for the week ending March 8th averaged 797,000 barrels per day. This is down 1 per cent vs. last week and down 10.7 per cent vs. last year.

Total ethanol production for the week was 5.6 million barrels. Corn used in last week's production is estimated at 83.7 million bushels, down from 84.5 the week prior.

This crop year's cumulative corn used for ethanol production for this crop year is 2.3 billion bushels. Corn use needs to average 87.9 million bushels per week to meet this crop year's USDA estimate of 4.5 billion bushels. Stocks as of March 8th were 18.7 million barrels.

This is down 3.4 per cent vs. last week and down 15.2 per cent vs. last year. Implied demand surged to 6.2 million barrels, up from 5.7 the week prior.

The data suggests a negative short term view of the corn market give the production decline but positive long term as stocks continue to deteriorate.

May Rice finished down 0.455 at 14.78, 0.19 off the high and 0.045 up from the low.

Soy Futures Closed Lower

May Soybeans finished down 22 at 1446 3/4, 22 off the high and 6 1/2 up from the low. July Soybeans closed down 20 3/4 at 1425. This was 6 up from the low and 20 3/4 off the high.

May Soymeal closed down 6.7 at 429.5. This was 4.0 up from the low and 7.6 off the high.

May Soybean Oil finished down 0.55 at 49.43, 0.63 off the high and 0.2 up from the low.

May soybeans traded down double digits today on reports that China's port stocks are sitting at stable levels as Brazilian vessels make their way to deliver fresh supplies.

The news sparked rumors that US soybean sales cancellations could be on the way. There was also talk that Brazil may have eliminated a tax credit for domestic soy oil which would cap domestic soy oil prices.

Some traders suggest this could reduce Brazil soybean crush margins by as much as $20. Cash markets were softer in the US and meal prices slide lower on declines in demand.

Below normal rainfall will be seen in Southwestern Argentina over the next 2 weeks and sources in Argentina note that farmers have been light sellers of new crop soybeans this week and new crop may begin to hit the supply pipeline by the end of this month.

Central Brazil will see good crop conditions over the next week with the driest areas limited to northeastern Brazil. Showers will push into southern Brazil at the tail end of this week.

The US Dollar surged higher this morning after good US economic data was reported and made a new high for the move. This limited gains in many commodity markets including soybeans.

Wheat Futures Closed Higher

May Wheat finished up 6 1/2 at 710, 1 1/4 off the high and 13 up from the low. July Wheat closed up 4 1/2 at 708 1/4. This was 11 up from the low and 1 1/4 off the high.

Wheat markets traded both sides of the unchanged today. KC and Chicago wheat saw selling pressure from the lower trade in the corn and soybean markets as well as the stronger trade for the US Dollar.

Additional downside pressure was linked to profit taking and favorable weather conditions in the eastern Corn Belt which should benefit the Chicago wheat crop this summer.

Wheat gained on corn as traders took profits in long corn vs. short wheat spreads. Cash traders note that up to 15 trains of Chicago wheat are set to load out of Eastern Corn Belt terminal space for southwest feed markets.

News wires reported this morning that US exporters have been in talks with Iran in the last week to possibly sell 100-110,000 tonnes of Kansas City wheat to the country.

Iraq issued a 50,000 tonne wheat tender as well. A German cooperative estimates that Germany will harvest 23.5 million tonnes of all wheat in 2013, up from 22.3 in 2012.

May Oats closed down 1 3/4 at 392 1/4. This was 5 up from the low and 1 3/4 off the high.

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