Soybeans continue to climb overnight with front-month March futures adding 6 cents a bushel, and trading above $14.10. For corn and wheat, prices continue to falter with both markets giving up 2 cents a bushel in overnight trade.
Brazil’s crushing association, Abiove, is standing by its forecast for a record crop of 88.6 MMT despite concerns over heavy rain in top growing state Mato Grosso and dry weather in No. 2 growing state Parana. But the association, which added 1 MMT to its 87.6 MMT forecast on Feb. 19, doesn’t expect to raise it further. In Brazil, heavy rains are also disrupting transportation as flooding and delays along the “soybean highway” have slowed farmer deliveries to the port. The dry spell in the Brazil growing region over the past few days is expected to end with rains returning and expected to persist over the next week. This morning, USDA’s export sales report showed over 300,000 MT of old-crop bean sales, even though many had been looking for net cancellations this week.
In wheat, yesterday Argentina announced an increase in their export licenses by 500,000 MT which could potentially trim Brazil’s wheat purchases from the US. Also yesterday, Egypt’s GASC announced a fresh round of tenders to buy various wheat types, but it seems unlikely that the US will garner much of that business. Earlier in the week Egypt canceled 110,000 MT of US wheat orders. High freight and lack of capacity at US ports are expected to keep US interests limited in this latest tender. The last Egyptian tender put US freight to Egypt at about $40 MT as compared to $17 MT for Russia.
For corn, prices have found little support in the recent soybean rally as nearby March trades back down to the $4.50 level. Basis levels have continued to inch lower as well in the face of heavy farmer deliveries. In ethanol, weekly production figures came in at 905,000 BPD, up 2,000 BPD from last week’s total.
WEEKLY EXPORT SALES (in thousand metric tons)