Grain Market Report: 21Jan2011

Tanner Sheahan
Tangent CPS

Didn't get today's report until this evening when I got back to the office.  Prompt prices are $8.00 for Feb-May then drop off to $7.95 for June.  New crop for 2011 is at $7.90 today.  USDA is confirming these prices.

The Columbia River has been closed since the about the first of December but will reopen around the middle of March.  So, what's wheat going to do when the river reopens?   Leave your comments below...


Informa will release their next guess on what the US acreage profile will be later today. Export sales reports were AWESOME this morning. Traders were hoping for corn sales of 21.6 to 33.5 myn bu and we ended with 40 myn bu. Remember there is always a ‘lag’ between sales and shipments, but with the world situation as it is, it sure looks like all sales today will be lifted ex the US….Wheat sales were also excellent. Again traders were hoping for 11.8 to 27.5 myn bu, but we went over the top at 38.7 myn bu. Jordan booked another 5.5 myn bu. The EU appears to be just about ‘tapped’ out of exportable quanities of ‘milling’ grade wheat. Argie posts are closed to wheat/ corn. With another stroke of the political pen, the EPA has once again changed the game by allowing E-15 on vehicles from 2001-06. IF a 15% blend was available and sold it increases ethanol use/ blend by 50% and would require 7.5 byn bu of corn…that is a ‘most optimistic’ scenario…won’t happen, but there will be increased ethanol usage, at least until the blenders credits and subsidies are re-visited….there will also be lawsuits. Meteorologists are now expecting with current strength of La Nina that it would linger for another 3 months OR perhaps even form a ‘double event’…which is pretty rare.
           China will auction off 70.8 myn bu of corn from reserves. Argie corn crop estimates are down about 4 myn mt vs. the last USDA estimate. USDA has em at 23.5 myn mt, latest Argie guess is 19.5. Recent rains will definitely help with bean production, and stem corn losses. Today it appears that whatever losses Argie corn will suffer happened a month or so ago. Chinese wheat purch of Aussie wheat is very good news for the Aussie’s but what’s it mean for everything else? It is consumptive demand and illustrates that Chinese demand is growing much faster than production (severe drought has not been broken…and has actually intensified in the northern provinces). It also removes wheat from the world S&D equations.
***Didja Know: 81% of the people who drown after falling through ice, are in water less than 3’ deep? The most common injury to snow skiers is a dislocated shoulder….and for you world travelers…statistically it is safer to travel on the roof a train in India, than in the back of rickshaw in Shanghai…