Carl German, Extension Crops Marketing Specialist; clgerman@udel.edu
USDA Export Sales Report — Week Ending 7/30/09
The weekly export sales report is viewed as neutral to bullish across the board for the week ending July 30. Either the total export sales reported has surpassed USDA’s projection for the ‘08/‘09 marketing year (as is the case with corn and soybeans) or is keeping pace with USDA’s projection (the case for wheat).
Pre-report estimates had weekly corn export sales at 33.5 to 45.3 million bushels combined old-crop and new-crop sales. The weekly report showed export sales of 16.6 million bushels in old-crop corn, bringing total sales to 1.863 billion bushels above USDA’s projection for 1.8 billion bushels for the ‘08/‘09 marketing year, while new-crop sales were 28.7 million bushels. Total shipments of 46.8 million bushels were below what was needed this week.
Pre-report estimates for soybeans ranged between 77.2 to 86.3 million bushels of combined old-crop and new-crop sales. The weekly report showed export sales of 18.2 million bushels in old-crop soybeans, making total sales for the year 1.305 bb — above USDA’s revised projection for 1.26 billion bushels, new-crop sales were 88.5 million bushels. Total shipments of 8 million bushels were below what was needed this week.
Pre-report estimates for wheat ranged between 14.7 to 18.4 million bushels of export sales. The weekly report showed export sales of 20.3 million bushels, above the 15.9 million bushels needed to stay on pace with USDA’s revised projection of 925 million bushels. Shipments of 8 million bushels were below what was needed this week.
Market Strategy
New crop corn and soybean prices have bounced back further this week from recent lows set July 22 ($3.14) and July 16 ($8.85), respectively. The recent price rally is attributed to strength in the Dow and crude oil prices, weakness in the dollar, and non-commercial speculative buying.
The short-term trend for the corn market is higher due to non-commercial buying and outside market forces. The nearby September futures contract is set to test resistance near $3.70. Longer term the corn market remains fundamentally bearish. Any trek higher is likely to be short lived in the event that a weather problem (early frost) does not occur. Next week’s USDA August Supply and Demand report is likely to take new crop corn prices lower if USDA follows private forecasts being released this week and increases the production estimate for corn. What has to be decided is whether current price offerings offer any pre-harvest sales opportunities. Dec ‘09 corn futures closed at $3.57 on Wednesday afternoon, 29 cents per bushel better than last week and 40 cents per bushel better than the recent low.
The trend for new crop ‘09 soybean futures remains up with resistance now placed at $10.99 1/2 , the June High. Considering the fact that the soybean market is being buoyed by bullish underlying fundamentals, a retest of the June high now appears possible. Nov ‘09 soybean futures closed at $10.45 per bushel on Wednesday, August 5, $1.29 per bushel better than last week and $1.60 per bushel better than the recent low.
For technical assistance on making grain marketing decisions contact Carl L. German, Extension Crops Marketing Specialist.