July 6, 2007

 

Argentine soy prices up on CBOT, but energy crisis limits gains
 

 

Argentine soybean prices were up on the week at the Rosario Grain Exchange Thursday (Jul 5) on gains at the Chicago Board of Trade, but domestic processing problems due to power shortages weighed on demand, according to analysts.

 

Domestic demand for soybeans is weak as the processors are reducing operations due to the energy problems some crushers and ports are facing, the Rosario Grain Exchange said.

 

The government has been cutting power supplies to the industry as high demand outstrips supply.

 

Argentina began to run into chronic cold weather-related gas shortages three years ago, as demand fuelled by strong economic growth began to outpace sluggish sector investment.

 

Spot soy closed at 625 pesos/tonne (US$202.19/tonne), up from 615 pesos/tonne a week ago. Spot volume totalled 7,000 tonnes.

 

May 2008 soy traded at US$216, up from US$215 last Friday. Soy futures were not traded last Thursday.

 

 

Wheat
 

January 2008 wheat closed at US$160/tonne, also unchanged from a week ago. New-crop trade volume was very high at 100,000 tonnes. Exporters led new-crop wheat buying, according to the Exchange.

 

Spot wheat was traded at 440 Argentine pesos/tonne Thursday (Jul 5), unchanged from a week ago.

 

 

Corn
 

Spot corn was traded at 325 pesos/tonne, down from 350 pesos/tonne a week ago. Volume was estimated at 2,000 tonnes.

 

April 2008 corn has not been traded for two weeks, selling last at US$114/tonne on Jun 21.

 

With the export registry for corn closed and uncertainty over future prices, buyers are sitting out the market, according to traders.