September 15, 2006

 

Argentina's cash corn price down; soy up

 

 

Cash corn sold for ARS262 per tonne Thursday (Sep 14) in Rosario, down from ARS270 a week ago. Mar 2007 futures slipped to US$83 per tonne from US$87 a week ago.

 

Domestic corn prices were lower following weakness in Chicago.

 

Forward export commitments for corn are also high and there will likely be tight supplies in December, according to analysts.

 

New-crop export commitments totalled 2.374 million tonnes as of Sep 12, according to the Agriculture Secretariat. This is over four times the pace of new-crop export commitments at this time last year, according to analysts.

 

As of Sep 8, Argentina had sold 7.52 million tonnes of 2005/06 corn for export, compared with 10.515 million tonnes of 2004/05 corn at this time last year, according to the Secretariat.

 

Malaysia has been the principal buyer of Argentina's 2005/06 corn crop, importing 1.39 million tonnes, followed by Chile with 940,000 tonnes and Algeria with 640,000 tonnes.

 

Meanwhile, new-crop corn planting has commenced, although drought in the western pampas is delaying seeding.

 

As of Sep 8, 2.4 percent of the area forecast for corn had been planted, up from 1.9 percent last week, but down 0.8 point from this time last year, according to the Exchange.

 

Area planted with corn is expected to total 2.47 million hectares, up 5 percent from last year, the Exchange said.

 

The dry and cold weather slowed planting during most of the week, the Exchange said.

 

Argentina will plant an estimated 3.2 million to 3.3 million hectares of corn during the 2006/07 crop cycle, up 3 percent from 3.18 million in 2005/06, according to the Agriculture Secretariat.

 

The US Department of Agriculture estimates that Argentina will produce 17.5 million metric tonnes of corn during 2006/07.

 

 

Soy

 

Traders were focusing on soy trades based on the uncertainty surrounding wheat and corn, Pels said.

 

Cash soybeans sold for ARS520 per tonne Thursday, up from ARS517 a week ago. May 2007 soybeans closed at US$166 per tonne, down from US$168 a week ago.

 

Trade volume reached 50,000 tonnes compared to 5,000 tonnes a week earlier, according to an e-mail market commentary from Javier Cabanellas of Roagro SRL.

 

The USDA has estimated Argentina's 2006/07 soybean crop at a record 41.3 million tonnes compared with 40.5 million tonnes the previous year.