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Asian Buyers Snap Up Corn Bargains

A huge week of new corn bookings could encourage USDA to raise its forecast for the 2011 marketing year when supply and demand balance sheets are updated next week.

The agency reported net sales of 50.8 million bushels in the latest week, which ended just before its bearish estimate of 2010 carryout was published. Japan and South Korea took some 70% of the total. China bought and shipped out one load, continuing to suggest quick turnarounds. While quantities so far have been small, the market is enthusiastic about potential business after the U.S. Grain Council this week forecast Chinese imports will run between 200 and 400 million bushels, more than doubling USDA's current projections.

Actual shipments of corn remain slow due to tight carryout and slow replenishment of pipeline stocks.

Soybean sales also exceeded trade guesses, with 27.3 million bushels of new business put on the books. China accounted for only half the sales and even less of the 12 million bushels shipped. That suggests numbers could really pick up when Chinese buyers return from this week's holidays and shift their attention from South American originations.

USDA today also reported the sale of 4.2 million bushels to China under its daily reporting system for larger purchases.

Wheat sales of 15.8 million bushels were unchanged from the prior week and in line with trade guesses. Sales and shipments remain above the levels forecast by USDA for the marketing year, which could force the agency to increase its estimate when projections are updated in next week's supply and demand report.

U.S. wheat sales continue to focus heavily on Asia and the Americas, with Black Sea wheat dominating shipments into North African and the Middle East.

For the complete export report, click here.