Markets were boosted yesterday by a positive grain price outlook from Goldman Sachs. Goldman Sachs raised their three-month corn forecast from $3.75 to $4.15 per bushel, their six-month forecast from $4 to $4.50 per bushel, with their 12 month outlook steady at $4.50.
Goldman also raised each of their soybean price forecasts by 50 cents. Their three-month forecast is for $9.75, six at $9.50, and twelve-month price at $9.50 per bushel.
Their wheat outlooks rose from $4.75 to $5.20 per bushel (3-mo), $5 to $5.50 per bushel (6-mo), and $5.40 to $5.75 (12-mo).
Positive trending grain markets always stimulate speculative traders to buy and Goldman’s higher price forecasts adds fuel to the fire. With much of the Corn Belt feeling 90 to 100 degree temperatures and a drought reducing the former Soviet Union crops spec traders have ample reason to buy.
The Chinese National Grain and Oils Information Centre (CNGOIC) reported that four cargoes of U.S. corn are expected to arrive this morning, with exporters advancing delivery due to tightening August supplies. The growing Chinese crop is reported to be getting plenty of rain and cooler than normal temperatures, however.
Total Jan-June corn imports into South Korea rose by 20 percent this year, to 4.2 million tons, compared to 3.5 million tons in 2009. U.S. shipments made up 3.9 million tons of that six-month total, compared to 2.5 million tons in 2009.
Strategie Grains cut their 2010 European Union soft wheat crop forecast by 3.6% this month to 129.5 million tons, now below last season’s 129.8 million tons crop.
Reuters polled 15 grain market analysts yesterday and came up with an average U.S. corn yield estimate of 163.1 bushels per acre, up from estimates of 163.0 bushels per acre at the start of the season, but a shade below the USDA’s current 163.5 bushels per acre figure. Estimates ranged from 158.8 to 167.0 bushels per acre.
Corn and wheat export sales were sluggish with 309,400 of wheat sold for the 2010-11 marketing year, down 40 percent from the previous week and 53 percent from the prior 4-week average. Net corn sales of 678,100 tons for delivery in 2009-10 were up 35 percent from the previous week, but down 19 percent from the prior 4-week average. Net corn sales of 345,300 tons for delivery in 2010-11 were also announced.
Net soybean sales of 666,500 tons for delivery in 2009-10 were up noticeably from the previous week and from the prior 4-week average. Net soybean sales of 558,500 tons for delivery in 2010-11 were announced, making total soybeans sales strong for this time of the year.
The U.S. Dollar index plunged overnight posting new lows for this down move that started in early June. This recent weakness is really helping to stimulate grain prices higher.
