Home / Markets / Markets Analysis / Corn market / Europe underpins corn market

Europe underpins corn market

10/27/2011 @ 3:50pm

The news of agreements in Europe regarding the debt situation was nothing but positive for the markets today.  Sharp rallies, following yesterday’s sharp declines, were the rule.  

All is not well with the corn, wheat and soybean markets.  There are other countries around the world with exportable supplies competing with the US for market share.  This issue, combined with relatively high prices, means US exports have been off to a slow start this marketing year.

Slow, in some cases, is an understatement.  This is especially the case for US soybeans. Sales commitments are way behind last year--some 330 million bushels behind.  Shipments are not as bad, but the marketing year is young.  What is happening?  Brazil and Argentina have garnered much more business, primarily from China.  For several months in the summer and early fall, due to currency values, these countries were significantly cheaper.  Now there is not that much Chinese business left to do--just some sales in the January-March timeframe, before South American harvest starts.   

For corn, the situation does not look quite as bad.  Sales commitments are actually quite strong, but shipments still lag.  The sales to China are helpful for corn sales totals.  Plus, the crop size is small enough that exports need to be smaller, allowing competitors such as Argentina and the Ukraine to fill the gaps this year. 

-------------  

The risk of loss in trading commodities can be substantial.  You should therefore carefully consider whether such trading is suitable for you in light of your financial situation.  


CancelPost Comment
MORE FROM RON AND SUE MORTENSEN more +

Market Transitions to New-Crop Contracts By: 04/17/2014 @ 2:54pm The market is paying attention more and more to the new-crop situation. How much corn is planted?…

What's leading, soybean or wheat market By: 03/20/2014 @ 2:24pm After many weeks of watching the soybean market lead the bullish charge, it would appear a new…

A flip-flopping soybean market By: 03/13/2014 @ 2:45pm The soybean market has a different attitude this week based on reports that China has been…

MEDIA CENTERmore +
This container should display a .swf file. If not, you may need to upgrade your Flash player.
Big Picture: CME Trading Weather