February 11, 2009

The US Department of Agriculture's February supply and demand report was supportive for Chicago Board of Trade soy and corn futures and neutral for wheat, traders said Tuesday (February 10).

CBOT soy are called to open 10-15 cents per bushel higher, while corn is called to start 3-5 cents higher. CBOT wheat is called to open 5-8 cents higher.

The USDA cut its estimates for South American soy and corn production more than expected, traders said. Hot, dry weather has hurt the crops in Argentina and Brazil.

"They just slaughtered Argentina's stuff," a CBOT floor trader said. "There must really be problems."

The USDA pegged 2008-09 US soy carryout at 210 million bushels, above the average analyst estimate of 203 million. In January, the agency estimated carryout at 225 million.

Argentina soy production was pegged at 43.8 million tonnes, compared to the USDA's January estimate of 49.5 million. Brazil's soy crop was estimated at 57 million tonnes, compared to the USDA's January estimate of 59 million.

The USDA estimated 2008-09 US corn carryout at 1.790 billion bushels, compared to the average analyst estimate of 1.838 billion bushels. The February estimate was unchanged from the agency's January estimate.

The USDA projected Argentina's corn crop at 13.5 million tonnes, compared to its January estimate of 16.5 million tonnes.

Wheat carryout for 2008-09 was estimated at 655 million bushels, unchanged from the USDA's January estimate but slightly above from the average analyst estimate of 649 million.

The USDA estimated Argentina's wheat crop at 8.4 million tonnes, down from its January estimate of 9.5 million.