No doubt, all of us have read or seen stories in which an overjoyed young child receives a long-hoped-for gift, only to see it snatched away by some unfortunate change in circumstance. It is not difficult to imagine just how crestfallen this child would be, and indeed, many of us may have felt this sense of disappointment at some time or another in our lives. Not too often, I hope. That said, this must have been the sentiment experienced by more than a few bulls this morning after seeing the weekly export sales, particularly for bean traders who had successfully pushed nearby futures into a higher high overnight, but now are confronted with a possible outside lower reversal.
It was anticipated that sales would not be stellar, but no one was prepared for just how poor they turn out to be. Both corn and wheat set marketing year lows, and beans were down 63% for the week and below even the lowest expectation. Beginning with wheat, we sold just 167,700 MT or 6.16 million bushels. Bangladesh was the top buyer with 55k MT, followed by Mexico, taking 53.5k, and then Japan, in for 52.4k. There were sales of 14.8k MT for new crop. Current crop year corn sales dropped 55% from last week and were 85% below the 4-week average with a total of 453,300 MT or 17.8 million bushels. Peru was at the top of the list with 160.3k MT, followed by Vietnam at 146.2k, and then Japan taking 96.5k. There were reductions of 300.5k MT from unknown. For the 2021/22 crop year, there were sales of 145.9k MT. Soybeans sales were barely higher than wheat, coming through at 167,900 MT or 6.17 million bushels. The top buyer was the Netherlands with 139.1k MT, followed by Japan taking 77.7k and then Germany with 75.2. There were cancellations of 300.8k during the week via unknown destinations. Sales for the new crop year were none too impressive either at just 70.8k MT. With the exception of cotton, which rebounded from a miserable prior week, most other commodities’ sales were lower as well. Both barely and sorghum recorded net reductions, meal was down 50%, oil flat, Hides and Skins sunk 41%, Beef sales were down 63%, and Pork dropped 23%. I would note, though, that China was still a buyer of 3,700 MT of pork.
We do have a few economic releases to pass along this morning as well. The preliminary 4thquarter GDP came in right as expected, showing growth of 4.2%. This was a slight improvement from the advance number released previously. January Pending Home Sales were down 2.8% for the month, compared with an estimated .5%drop and year over year were up 13%. Finally, the weekly initial jobless claims dropped more than expected, falling 111,000 to 730,000 new claims. Another baby step in the right direction.
Metals and energies are lower, as are equities and the U.S. Dollar.