January 5, 2009
Asia Grain Outlook on Monday: Crude price recovery may aid grain prices
A recovery in crude oil prices due in part to Israel's Gaza strikes is likely to keep grain prices higher over the next few days.
And if equities markets stay upbeat, it would enhance grains' bullishness.
Chinese demand for U.S. soybeans remains strong and as concerns that dry conditions will affect South American crops mount, prices may remain well-supported in the near term.
Fewer fundamental factors are apparent for corn, though U.S. analysts said that in the near term, lows reached Dec. 5 in wheat, corn and soybean contracts at the Chicago Board of Trade are likely to hold as strong support levels.
In Asia, continued cold, foggy weather could benefit Pakistan's wheat crop, which is being sown, the country's Daily Times newspaper quoted experts as saying.
Farmers Associates Pakistan Director and Chief Coordinator Mohammad Tariq Bucha told the daily that that the colder the weather is, the better the yield will be.
Pakistan is a major wheat producer in Asia, which nevertheless imported heavily in 2008 to meet its domestic needs.
In late December, the state-owned Trading Corporation of Pakistan concluded a tender to import 590,000 metric tonnes of wheat, to be delivered this month.
It is seeking 250,000 tonnes of white wheat from the U.S. in a tender that will conclude Jan. 10.
On Dec. 29, the U.S. Department of Agriculture announced that it will offer US$48 million in credit assistance to the Trading Corporation of Pakistan against U.S. wheat imports.
Earlier, on Dec. 18, the USDA had announced it would donate 50,000 tonnes of U.S. wheat, valued at US$18 million, to Pakistan under the Food for Progress program.
