November 16, 2007

 

Argentine corn prices slip on week as exporters overbought 
 

 

Argentine corn prices closed lower on the week at the Rosario Grain Exchange Thursday (November 15, 2007) as exporters have overbought the old crop and are unable to make new export commitments due to the continued closure of the government's export registry, according to analysts.

 

"If the export registry isn't opened in the short term, it will be hard for (corn prices) to find support," the Rosario Grain Exchange said.

 

The corn export registry has been closed since June. On Tuesday, the government reopened the wheat and soy export registries, but left the corn registry closed.

 

Exporters must make a sworn declaration to the government of an export sale before shipping the goods. A reference price for tax purposes and the applicable tax rate are locked in once the company declares a shipment.

 

Spot corn was traded at ARS325 ($104) per tonne, down from ARS350 a week ago.

 

However, corn futures gained on the week. April 2008 corn sold at $115 per tonne, up from $113 last Thursday.

 

Wheat

 

Wheat prices slipped on the week, but recovered somewhat on Thursday on gains in Chicago and strong local demand, the exchange said.

 

January 2008 wheat closed at $170 per tonne, down from $185 a week ago.

 

Spot wheat sold for ARS560 per tonne Thursday, unchanged from a week ago.

 

Frost in some areas of Argentina spurred fears of crop damage, although the freezing does not appear to be widespread.

 

"It's not clear what the real consequences were, but the news already got to Chicago and caused, at times, significant gains in wheat," Roagro analyst Javier Cabanellas said.

 

Exporters have already declared about 3 million tonnes of new-crop wheat exports since the opening of the export registry Tuesday, according to the exchange. Argentina is expected to ship about 10 million tonnes of wheat from the 2007-08 crop, according to analysts.

 

Soy

 

Soy prices were up on the week but volatility in Chicago limited the gains, the exchange said.

 

Spot soy sold for ARS795 per tonne in Rosario Thursday, up from ARS750 a week ago.

 

May 2008 soy sold at $245 per tonne, up from $230 last week.