FOB Gulf corn steady, soyabean higher

20 Oct, 2004

US Gulf corn basis offers were steady on Monday while soyabeans for November shipment were higher amid slow farmer selling, traders said.
Hard and soft red winter wheat basis offers were mostly steady, but export demand for both was thin.
Barge freight on rivers moving grain to Gulf export elevators was lower amid a decline in demand from shippers as farmers held tight to their grains.
Offers at St. Louis were down 15 percentage points from Friday at 310 percent of tariff for this week; Illinois River offers were down 25 points and Lower Ohio down 5 points.
Traders said farmer-selling of corn and soyabeans remained slow, helping to underpin basis values in both markets.
"It's just more of the same. Farmers are not selling very much," a trader said, linking the slow movement to the lackluster exports of corn last week.
USDA said 22.3 million bushels of corn were inspected for exports last week, down from 35.1 million the previous week.
"There are some deliveries of forward sales, but fresh sales of corn are very limited," another trader said.
Traders said corn exports were also being weighed down by rising ocean freight and competition from cheap feed wheat from the Black Sea region. Ocean freight rose to $57 per tonne on the benchmark Gulf-Japan route from $54.50 last week.
"Freight keeps going up. But the end-user thinks it has to come back down, so he's not buying any grain," a trader said.
Soybean basis offers were higher for November shipment amid slow farmer selling, traders said. December basis offers were lower on expectations that movement will pick up by then.
A trader said there was a lack of fresh export interest, adding that importers felt current prices were too high when seen in the context of forecasts for a record-large 2004 crop.
"Japan thinks our prices are too high," the trader said, adding that slow movement however was boosting nearby values.

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