US FOB Gulf corn and soyabean basis offers were firm on Tuesday supported mainly by tight loading capacity for December and January shipment and helped further by steady export demand, traders said.
Wheat basis values have fallen during the past week as futures prices rallied. Despite the rallies, Egypt's GASC issued a tender seeking wheat for shipment December 25 to January 10. US wheat was expected to face stiff competition from Argentine, Russian, Kazakhstan and French wheat in the tender.
Soft white wheat cash prices to farmers in the Pacific Northwest hit a record high on Tuesday amid tight supplies and strong export demand, including a recent sale to Pakistan. Prices for wheat delivered in 2008 climbed to above $12 a bushel, up from about $5 a year. Some exporters said white wheat supplies were so tight, they did not plan to offer that variety of wheat to Pakistan in its tender for 200,000 tonnes that closes on Saturday.
In addition, regular buyers of US white wheat such as South Korea, Japan and Taiwan were also in the market this week. Corn export demand remained steady and was underscored by Mexico buying more than 500,000 tonnes of US corn recently. "It's not uncommon for Mexican buyers to go way out and price the futures later," said a corn trader.
Israeli private buyers also bought a cargo of US corn for shipment March 15 through April 10. High ocean freight rates are giving US corn an advantage over South American supplies shipped to the Middle East, traders said. In the Israeli tender, corn from Argentina was also offered, although the export registries were closed at the moment. The registry is expected to reopen to allow corn for shipment sometime in March traders said.
The Middle East has been buying large amounts of corn from the United States, mainly because Ukraine's ban on grain exports has cut off traditional supplies. Soyabean demand was routine, with China buying its regular cargoes. Its purchases have slowed down from November when the state sought to boost reserves to combat domestic food inflation.