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Are Export Sales Strong Enough To Lift the Grains?

This morning’s export sales were strong, but are they strong enough to get grain prices moving higher again?

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In the overnight session corn is trading ¾ of a cent lower, soybeans are trading 2 ½ cents higher and wheat is trading lower ¾ of a cent lower going into the morning pause.

Corn export sales beat analyst expectations by increasing 19 percent week over week and booking 1,003,100 metric tons. This week’s sales were well above the 600,000-800,000 metric tons expected by the market. Soybeans also had a fantastic week booking 745,400 metric tons which is up 52 percent from last week and nearly double the 250,000-450,000 metric tons expected by the market. Soybean sales are still well ahead of pace even after accounting for the 20 million bushel increase in the February WASDE report. Wheat sales improved only 3 percent over last week with a weekly total of 409,300 metric tons compared to expectations of 300,000-500,000 metric tons.

Expectations Actual

Corn 600,000-850,000 1,003,100

Soybeans 250,000-450,000 745,400

Wheat 300,000-500,000 409,300

Weekly ethanol production increased 13,000 barrels per day to 961,000 BPD even as weekly ethanol stocks rise again. This week stocks grew 149,000 barrels to 21.14 million barrels. Ethanol production continues to run 5.6 percent ahead of last year’s production pace. In the February WASDE report the USDA increased their corn used for ethanol forecast by 75 million bushels, lifting their ethanol production forecast from .8 percent increase over last year to 2.3 percent.

The Rosario Grain Exchange lifted its forecast for corn and soybean production forecast for Argentina significantly in their latest report. Corn production was raised to 23.5 million metric tons compared to their last forecast of 22.4 MMT. Soybean production was increased to 58 million metric tons from 54.5 MMT. Both estimates were higher than the February WASDE report which estimated Argentina corn production at 23 MMT and soybean production at 56 MMT.

The Brazilian government’s crop supply agency Conab cut its corn and soybean production estimates for Brazil in a recently released report. Corn production was lowered to 78.4 MMT from 79.1 MMT in January. Soybean production was lowered to 94.6 MMT from 95.9 MMT.

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