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Corn+Soybean Digest

Corn Export Sales Take a Dive

U.S. corn export sales nose-dived to a marketing year low during the week ended May 27 as major buyers stayed out of the market.

Weekly sales of soybeans and wheat were also disappointing as they fell below trade expectations

Net U.S. corn export sales commitments for the week totaled just 12.3 million bushels, down 81% from the average of the previous four weeks, according to Friday morning’s weekly USDA export sales report.

The export sales were well below trade expectations, which ranged from 27.5 million to 49 million bushels.

Weekly corn export sales for 2009-2010 delivery were only a net 7.8 million bushels as 4.5 million bushels in sales were for 2010-2011 delivery.

Japan was listed as the buyer of roughly 12.7 million bushels of U.S. corn on the week, but 5.6 million of those bushels were previously reported sales switched from unknown destination.

U.S. corn export sales commitments now total 90% of USDA’s 2009-2010 corn export projection of 1.950 billion bushels, slightly behind the five-year average of 91% for this point of the marketing year.

Actual corn export shipments equal 70% of annual export projection, which is 3 percentage points the five-year average.

Although the corn sales plunge could be a one-week aberration, several factors could cause foreign buyers to continue to shy away from U.S. corn in coming weeks.

Most foreign buyers appear to have their near-term corn needs covered and the great start to the U.S. growing season has end users anticipating larger supplies of corn and lower prices as we get nearer to the 2010 harvest

Strength in the value of the dollar is also offsetting the impact of lower U.S. corn prices for foreign buyers. The dollar has moved to multi-year highs against a number of currencies.

Also, export competition from South American corn is strong with Argentina’s 2009-2010 corn crop now thought to be close to record large.

Weekly U.S. soybean export sales commitments totaled 5.5 million bushels, 55% below the average of the previous four weeks and below trade expectations that ranged from 7.5 to 14.5 million bushels.

Export sales for 2010-2011 delivery were only 500,000 metric tons as Chinese buyers stayed out of the market.

Advance U.S. soybean sales for next marketing year, which total 133.5 million bushels have now fallen behind the year-earlier pace.

U.S. soybean export sales commitments for 2009-2010 remain on pace to meet USDA’s current export projection of 1.455 billion bushels.

Export commitments now total 90% of the annual export projection, even with the five-year average for this time of year. Actual U.S. soybean export shipments now total 92% of the export projection, ahead of the five-year average of 88%.

Weekly wheat export sales were a net 8.8 million bushels, below trade expectations that ranged from 9 million to 18.5 million bushels.

Net weekly wheat sales for 2009-2010 delivery were a negative 2 million bushels as cancellations of previous sales were larger than new sales.

Weekly sales for 2010-2011 delivery were 10.8 million bushels, with Mexico the leading buyer at about 3.2 million bushels.

As of May 27, U.S. wheat export sales commitments for 2010-2011 delivery totaled 112.9 million bushels, up from 91.9 million bushels a year earlier.

Editor’s note: Richard Brock, Corn & Soybean Digest's marketing editor, is president of Brock Associates, a farm market advisory firm, and publisher of The Brock Report.

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