February 26, 2007

 

Asia Grain Outlook on Monday: Premiums may rise on CBOT gains

  

 

Premiums of grains delivered to Asia may rise in the week ahead, as Chicago Board of Trade grains futures are expected to continue gains.

 

Over the past three CBOT sessions, grains fell only last Friday while posting sharp gains Wednesday and Thursday, as the threat of La Nina weather conditions for the U.S. summer crop and technical factors drove CBOT gains.

 

All the three major grains traded on CBOT - corn, wheat and soybeans - are moving in unison right now, with corn clearly leading the price trend for grains.

 

Grains buying in Asia may continue at the current sluggish pace as prices remain high.

 

The only major corn import deal over the past few days was South Korea's Nonghyup Feed Inc. buying 275,000 metric tonnes of U.S. No. 3 corn from Marubeni in tender. The entire cargo was purchased in a price range of US$232.84 to US$234.99/tonne.

 

In wheat, Japan's Ministry of Agriculture bought 95,000 tonnes of wheat from the U.S. and Australia.

 

In India, a panel of senior bureaucrats recommended a series of measures to the finance minister to keep food prices in check.

 

These measures include the continuation of the current zero duty on imports of pulses until March 2008. It was initially allowed only until July 31, 2007.

 

The panel said that the current policy of duty-free imports of wheat should continue beyond the current mandate of Feb. 28, 2007. They also recommended the appointment of a government-run agency to import duty-free corn.

 

These recommendations, if accepted, may be included in India's federal budget which will be presented in the parliament on Feb. 28.