August 29, 2008
Asia Grain Outlook on Friday: Corn, soybean prices may fall on CBOT
Corn and soybean prices may fall lower over the next few days as Chicago Board of Trade corn and soybean futures seem to have entered liquidation mode.
A decline in New York Mercantile Exchange crude oil futures Thursday despite the threat posed by Tropical Storm Gustav to oil infrastructure in the Gulf of Mexico encouraged grain market bears.
Recent rains in U.S. growing areas eased concerns that corn and soybean crops will be affected by dry weather.
On the production front, some bullish news is coming from China, where officials said production of corn and soybean could be affected by ongoing drought in Heilongjiang province.
The drought since early August "will definitely result in a unit-yield decline" compared with normal years, a grain official told Dow Jones Newswires.
Drought worries seem to be a thing of the past for Australia's wheat growers, who are gearing up for a normal 20 million-metric-tonne harvest following drought-affected output of 13 million tonnes last year and 11 million tonnes in 2006.
Rice exports down in Thailand
Rice prices are likely to keep falling for the next several weeks, as export demand slows, said Chookiat Ophaswongse, president of the Rice Exporters Association of Thailand.
The price of 100% grade B rice is around US$680/tonne, which is quite a descent from the peak of US$1,000/tonne in June, he said.
Thailand's rice exports in August are estimated to be the lowest so far this year, at 700,000 tonnes - exports will likely fall more next month, to around 500,000-600,000 tonnes, Chookiat added.
However, availability is still quite limited for Thai exporters, as farmers are mostly selling their rice to the government and not in the open market.
The state-set intervention price of THB14,000 (US$413)/tonne of unmilled rice is higher than the open market price.
Analysts added that while the government had earlier announced it is willing to sell rice from its stocks to exporters, the current political turmoil in Thailand has put rice sales on the back burner.
In other news, Cambodian rice industry officials have said they are seeking to export 50,000-70,000 tonnes of rice to Brunei, the Cambodia Daily reported.
Brunei regularly imports rice from Vietnam and Thailand, and also wants to tap Cambodia, the daily said.