Monday morning USDA news indicating that private exporters sold 102,2000 tonnes of corn for 2013 delivery over the weekend probably played a sizeable role in the moderate gains posted by the yellow grain market in early-week trading. The reaction may have been exaggerated by ideas that recent losses had been overdone by year-end position liquidation and pessimism about export prospects. And while the sales news seemed quite supportive, the result of the weekly Export Inspections report stated the latest total below forecasts, thereby suggesting the export situation remains precarious. The concurrent U.S. dollar decline was somewhat encouraging, since that lowered the comparative cost of U.S. grain. Ultimately, grain and soy complex trading could be subdued and/or choppy this week, since the USDA is set to publish major production and supply/demand news late Friday morning (1/11). March corn rose 4 1/4 cents to $6.84 1/2 Monday, while December gained 3 cents to $5.74 3/4 per bushel.
Pessimism about prospects for U.S. soybean exports has recently weighed rather heavily upon the grain and soy complexes. Moreover, soybean futures ended last week badly due to an increased 2012 production estimate from a private firm published Friday. The annual production total and expected ending-2013 stockpiles will almost surely be a major topic of conversation amid CBOT trading this week, since the USDA will release its latest estimates Friday morning (1/11). Given the bearish nature of recent soybean developments, including growing optimism about the size of the forthcoming South American crop, it would have been easy to anticipate continued losses Monday. But that was hardly the case, with nearby futures ending the Chicago session over 18 cents higher. The rise may have been largely driven by the simple fact that futures were relatively oversold in the wake of the December breakdown. March beans ended their Monday session 20 cents higher, at $13.87 1/4 per bushel, while March soyoil surged 0.15 cents to 50.05 cents/pound and March meal jumped $9.2 to $408.2/ton.
The weekly Export Inspections report proved more favorable to the short-term wheat outlook than for corn or soybeans, since the result, at 13,400 tonnes topped pre-report forecasts in the 9,000-12,000 tonne range. In addition, the nearby wheat contracts seem more technically oversold than do their CBOT counterparts. However, recent news that India may force stored product from its stockpiles onto the international market may bode ill for the wheat outlook, as might also be the case with improved precipitation forecasts for winter wheat pastures across the Southern Plains. Those may explain the limited nature of wheat gains posted Monday. March CBOT wheat climbed 3 cents to $7.50 1/4 per bushel; March KCBT wheat gained 3 cents to $8.07 1/2 and March MGE futures surged 4 3/4 cents to $8.45 3/4 per bushel.