Although corn sales posted last week topped the previous weekly total, the numbers still fell 10% short of the four-week average. That aspect of the data probably weighed somewhat upon yellow grain prices in Chicago Thursday morning, especially since it fell slightly below industry expectations. Indeed, wire service reports cited the subdued sales pace as being the slowest since 1987. The most-active March contract is now threatening to test its September-November lows in $7.08-$7.14 per bushel range. Conversely, technical support down to the $7.00 level could prove rather robust, especially if soybean futures build upon their recent gains. March corn ended the day 8 cents lower at $7.17 1/2, while the December 2013 contract fell just 2 3/4 cents to $6.23.
The weekly export data gave the soybean market a major boost. The latest sales total reached 1.3 million tonnes, whereas pre-report expectations averaged around 700,000. This was the largest weekly total in two years. The fact that Chinese buying accounted for about 1.0 million of the weekly total probably encouraged bulls as well, since that country represents such a huge market. The nearby January contract moved above its 40-day moving average around midsession, which may bode well from a technical standpoint. Of course, South American weather developments will very likely influence the market during the days and weeks just ahead. January beans closed 8 1/2 cents higher at $14.82 per bushel, whereas January oil slumped 0.27 cents to 48.91 cents/pound. January meal rose $4.0 to $456.0/ton.
The “gap” between weekly U.S. wheat sales and the target implied by the USDA WASDE data shrank from 220 million bu. last week to 178 million bu. this week, but only because the USDA cut its export forecast by 50 million bu. on Tuesday. So, since the gap shrank by LESS than 50 million ( 42 million to be exact), this week’s sales are STILL falling further behind where they “should” be based on 5 years of history for sales to date vs. the final total. We’re still only at 60% of USDA’s new forecast. The 5-year average is 77% and in the last five years, the LOWEST sales to date for this particular week in the marketing year reached 70% of the eventual total. Given these considerations, one has to wonder how low wheat prices would be in the absence of spillover support from the soybean market. March CBOT wheat closed 2 3/4 cents lower at $8.09 1/4 per bushel, while March KCBT wheat dipped just 1 1/4 cents to $8.64 and March MGE futures were down 3 3/4 to $9.00 3/4.