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Corn Sales Keep Chugging To New Highs

Buoyed by strong interest out of Asia, weekly U.S. corn exports posted their third consecutive marketing year high, in data released this morning by USDA. Total sales reached 47.9 million bushels, up around 4 million from highs set the two previous weeks.

While not especially impressive by historical standards — marketing year highs typically top 60 million bushels — the pick up in pace for 2009 comes at a crucial time for corn, as the market copes with demand hurt by the global economic slowdown.

Japan and South Korea led the list of corn buyers, after taking a go-slow position since harvest. Japan took 21.7 million bushels, while the Koreans added another 8 million. Feed makers from Korea bought more U.S. corn this week, though they also signed deals for substantial amounts of feed wheat. Competition from feed wheat helped limit U.S. exports earlier in the marketing year.

The increase in sales since the first of the year may be enough to convince USDA to make no changes to its forecast for exports, when the agency updates its supply and demand estimates on Tuesday. USDA previously aggressively cut its prediction in the face of rapidly declining sales.

While corn sales boomed, soybean business took a breather. Net new bookings dropped to a marketing year low of 12.5 million bushels, likely reflecting a slow down in business caused by the weeklong Chinese Lunar New Year holiday. Traders are keen to see whether Chinese sales pick up again in the next few weeks, especially with reports the government may begin to release reserves it recently purchased.

Wheat sales recovered from last week's marketing year low, coming in at 12.1 million bushels. Sales are winding down as crops in the southern hemisphere hit the pipeline, but remain above the rate forecast by USDA for the rest of the marketing year.

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