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New crop corn export sales surging

Agriculture.com Staff 02/11/2016 @ 12:34am

18th annual Allendale Yield Survey Results: A projected U.S. corn crop of 13.416 billion bushels vs USDA's August estimate of 13.054 billion and a bean crop of 2.740 billion bushels vs USDA's August estimate of 2.625 billion. This estimate was based on producer calculated yields in 20 states and was conducted from August 13 until August 24, 2007.

McHenry, IL: just a mere 469 miles separated the worst yielding corn to the best yielding corn according to results contained in the 18th Annual Allendale Farmer Yield survey for 2007. This estimate was based on producer calculated yields in 20 states and was conducted from August 13 until August 24, 2007.

Technicals: Old and New crop corn and soybeans and new crop wheat. For the short term trader, Allendale uses its own unique custom Moving Averages to monitor price momentum, define key support and resistance levels as well as advise where key pivot points are located when bulls may turn bearish and bears to turn bulls. We also include last weeks closing price for the weekly chartist as we draw closer to the end of the week to anticipate the possibility for futures to have a positive weekly close or if weakness is ensuing.

Observation: For the week, CBOT Dec wheat futures closed up 8.7%, KCBT wheat up 10.4%, MGEX Dec wheat futures up 8.8%, Nov soybean futures up 2.6% and Dec corn futures up 2.1%. Allendale Advanced Charts clearly shows the strong uptrend wheat is in. For CBOT Dec wheat, Allendales points out from Friday's closing price of 8434, futures could sell off to 7040 and still hold trend line support.

Observation: The most positive news is held within the 2006-07 shipments data. With only one day of data to be released for the 2006-07 market year, corn and soybean shipments exceeded USDA targets by 18 and 12 million bushels respectively. Therefore there should not be any carry over bushels dumped into the 2007-08 marketing year.

As of today's release of the weekly export sales report, new corn sales have reached 510 million bushels of a planned target for the entire marketing year of 2.15 billion. This suggests with the new marketing year just beginning this recent September, 2007, the U.S. has met 23.7% of its target. This pace compares to just 337 million bushels one year ago. New sales for 2007-08 are 51% better than year earlier levels.

We found two other years where sales this time of year exceeded 500 million bushel. They are 1996 at 504 million bushels and an outstanding 575 million bushels in 1995. Let's dig a little deeper to see if a fast healthy start in export sales could require USDA to hold a bigger target by the time the January annual report is released in 2008. USDA's initial target in 1995 was 2 billion bushels. By the time the August WASDE was released, USDA did not increase the export target but rather left it unchanged at 2 billion bushels.

When USDA did release the Jan annual report was released in 1996 did in fact increase the target by 150 million bushels or 7.5%. If USDA were to see a similar pattern develop for the 2007-08 marketing year they could revise export potential to a level of 2.31 billion bushels. USDA's initial target for 1996 was 2.1 billion bushels and weekly export sales by the end of Aug were a very healthy 504 million bushels but in the Aug 1996 WASDE decided to scale back its 1996-97 export potential to 2.05 billion. Contained in the January annual WASDE of 1997, USDA dropped export potential to 1.9 billion bu or 9.6%.

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