March 9, 2007

 

Argentina spot grain down on CBOT

 

 

Argentine grain prices mirrored moves at the Chicago Board of Trade with spot prices closing down Thursday (Mar 8) on the week and futures edging higher amid concern over a nationwide grain trucker strike, according to analysts.

 

The government also announced Wednesday the closure of the export registry for new wheat exports. However, markets shrugged off the closure as most of the new-crop wheat for export has already been sold.

 

Trade was muted as the market waited for the grain trucker strike to end and shipments to resume, according to the Rosario Grain Exchange.

 

Truckers have been on strike since Monday over shipping rates, payment structures, government requirements to update fleets, and other issues.

 

"The strike is very strong, they are completely blocking roads, in some cases even for cars," said Roagro analyst Carlos Boglioli.

 

"The truckers appear committed to take this to the end," he said.

 

Truckers are planning to march Friday on the central square fronting the presidential palace in the capital Buenos Aires. The stage is set for conflict, as the government has said it will not allow the march.

 

 

Wheat

 

Spot wheat closed at ARS345 per tonne in Rosario Thursday, down from down from ARS350 a week earlier. Just 1,000 tonnes of spot wheat were traded.

 

December wheat closed at US$120, up from US$115 a week earlier. Some 2,000 tonnes of wheat futures were traded.

 

On Thursday, the government suspended the wheat and wheat flour export registry.

 

Exporters had declared export commitments of 8.74 million tonnes as of Feb 28, according to the Secretariat.

 

The closure is designed to ensure domestic supply, the Secretariat said.

 

In January, the government announced that domestic wheat flour producers will receive direct subsidies to compensate for the spread between the official reference price and actual prices at the local exchanges.

 

However, millers are yet to be paid the subsidy and traders are taking a wait-and-see approach to the programme.

 

Dairy, pork, poultry and feedlot beef producers will also receive subsidies to compensate for increasing corn feed costs.

 

Argentina will produce 14 million tonnes of wheat in 2006/07, according to the Agriculture Secretariat.

 

The US Department of Agriculture is expecting 14.2 million tonnes of wheat from the 2006/07 crop.

 

 

Soy

 

Spot soy fell to ARS606 (US$195.17) per tonne at the Rosario Grain Exchange Thursday, down from ARS610 a week ago. Spot volume reached 5,000 tonnes.

 

May soybeans were priced at US$196 per tonne, up from US$193 last week. Just 2,000 tonnes of future contracts traded.

 

The Agriculture Secretariat forecasts that Argentina will produce 42.5 million tonnes of soy in 2006/07.

 

The USDA estimates that Argentina will produce 44 million tonnes.

 

 

Corn

 

Cash corn sold for ARS385 per tonne in Rosario Thursday, up from ARS380 a week ago.

 

April corn closed at US$126 per tonne, up from US$124 a week earlier. Some 5,000 tonnes of corn futures changed hands.

 

The Agriculture Secretariat sees 2006/07 corn production of 21 million to 22 million tonnes.