November 6, 2009

Spot soy prices eased on the week at the Rosario Grain Exchange in line with lower international prices, while corn and wheat prices showed little movement despite a government commitment to open up more exports.

 

Soy prices at the benchmark Chicago Board of Trade came under pressure due to a stronger dollar and weaker oil prices, the Rosario Grain Exchange said.

 

Spot soy traded at ARS950 (US$248.69) a tonne in Rosario Thursday (Nov 5), down from ARS960 a week ago. May 2010 soy futures traded at US$222 and US$225 a tonne in Rosario, compared to US$223 and US$225 a week ago.

 

Spot corn wasn't traded Thursday, while March 2010 corn contracts changed hands at US$115 per ton, unchanged from a week ago.

 

Neither spot wheat nor futures traded.

 

On Wednesday (Nov 4), Agriculture Minister Julian Dominguez said that the government has decided to approve the export of three million tonnes of corn and two million tonnes of wheat.

 

However, exports will still be regulated by the agricultural trade office, which tightly controls shipments to ensure domestic supply. If exporters buy more wheat and corn than is allowed for export, they will have to sell it back to the local market, said Rosario Grain Exchange chief analyst Rogelio Ponton.

 

The Buenos Aires exchange forecasts 2009-10 wheat production at 7.75 million tonnes.

 

With domestic demand pegged at 6.5 million tonnes by the government, just 1.25 million tonnes of wheat are likely to be left over for export from the 2009-10 crop. The higher amount the government said it will approve for export will likely come from stocks held over from the last crop.

 

The Rosario Grain Exchange forecasts total corn production at about 16 million tonnes.

 

The government has pegged domestic consumption of corn from the 2009-10 crop at eight million tonnes, leaving an equal amount available for export, according to the Rosario exchange.