May 11, 2009

Physical trading was quiet this week in the Mexican cash grain markets as the peso recovered from last week's low, traders and importers said Friday (May 8).

But gains from the stronger peso were offset by higher prices in the US market, and despite some offers and deals reported for yellow corn and soy, other markets remained quiet.

 
"The strengthening of the peso has helped bring more stability to the market, but the general activity has still been rather quiet and we haven't seen any significant new business done," said one trader in Mexico City.

The Mexican peso this week traded between MXN13.01 and MXN13.48 against the US dollar, after trading last week between MXN13.70 and MXN13.95.

Other traders said that many people had taken advantage of the extended long weekend and most business first starting to reopen on Wednesday following the emergency measures imposed by the Mexican government in the wake of a deadly flu epidemic.

"A lot of people didn't even come back this week so the market has been very quiet with the week cut in half," said a trader in the central Bajio region.

The local Mexican sorghum crop has started in the northern grain-producing state of Tamaulipas state, pushing down prices on imported sorghum as well and offering competitive pricing solutions to more expensive yellow corn.

The local market won't receive fresh supplies until mid-May, when the new 2008-09 fall-winter white corn crop from the key northern state of Sinaloa starts to reach the market. The harvest is scheduled to start late April.

Corn and wheat futures closed higher Friday at the Chicago Board of Trade, with July corn up 9 cents at US$4.21 a bushel and July wheat up 20 3/4 cents at US$5.91 a bushel.

Soy products, however, ended mixed with July soy settling up 9 1/2 cents at US$11.11 1/2 a bushel, but July soymeal closing down US$0.20 at US$341.50 a bushel.