Huge Corn, Soybean Export Sales

Friday morning's USDA weekly export sales report showed U.S. corn and soybean sales for the week ended Oct. 9 far above trade expectations, while wheat sales were disappointing.

USDA pegged weekly corn export sales at 66 million bushels, which is the highest weekly total since January of 1996 – a span of more than 7 1/2 years. Trade expectations were for sales of 27.5-35.5 million bushels.

Mexico and Japan were the biggest buyers of U.S. corn on the week, followed by Indonesia, unknown destinations and Egypt.

For the 2003-2004 marketing year to date, U.S. corn export sales commitments are now running 29.8% ahead of a year earlier. Actual export shipments are running 22.5% ahead of a year earlier.

USDA pegged soybean sales for the week ended Oct. 9 at 42.2 million bushels, more than double trade expectations of 11-20 million bushels.

The big sales total was driven by more strong Chinese buying, as China purchased more than 10.66 million bushels of soybeans on the week. Mexico was also a large buyer, taking more than 9.3 million bushels.

For the marketing year to date, U.S. soybean export sales commitments are now running 37% ahead of a year earlier. That is sharp contrast to USDA's projection for a 16.3% drop in U.S. exports this year and sends a clear message to the market that U.S. soybean supplies are not yet being sufficiently rationed.

Wheat export demand is another story, as USDA's weekly wheat export sales total of 15.6 million bushels was at the low end of trade expectations.

The low sales total provides further evidence that U.S. wheat was too high priced in early October to compete strongly with Australian and Canadian wheat in the world market.

For the marketing year to date, U.S. wheat export sales commitments are now running 17% above a year earlier, with USDA projecting a 23% increase in exports. However, actual wheat export shipments continue at a fast pace as they are running 29.5% above a year earlier.

Editors note: Richard Brock, The Corn and Soybean Digest's Marketing Editor, is president of Brock Associates, a farm market advisory firm, and publisher of The Brock Report.

To see more market perspectives, visit Brock's Web site at www.brockreport.com.