US corn and soybean export premiums at the Gulf Coast were generally steady on Thursday as a sharp drop in futures prices this week stoked demand but US supplies continue to face stiff competition from South American exporters, traders said. Chicago Board of Trade corn and soybeans rose modestly on Thursday in a rebound from Wednesday's steep losses triggered by an unexpected increase in USDA crop forecasts. But both commodities remain on pace for weekly declines.
Enticed by the lower prices, South Korea's FLC bought 60,000 tonnes of optional-origin corn and KOCOPIA bought 60,000 tonnes of optional-origin corn on Thursday. Analyst firm Strategie Grains cut its EU corn crop outlook by more than 10 percent and said a heat wave in central and eastern Europe could make yields deteriorate further. Traders said the crop reduction could stoke demand for US grain. Chinese importer demand for US soybeans remains routine, with price inquiries largely focused on fourth-quarter shipments. A 4 percent drop in the value of the yuan this week has eroded crushing margins there, which has kept a lid on fresh purchases, traders said.
A warehouse explosion disrupted ship arrivals and departures at China's Tianjin port. Disruptions were confined mostly to metals and oil ships but there are several soy crush facilities near the port that import through Tianjin. FOB wheat basis offers were flat on limited demand, with US exports struggling to compete with low-cost suppliers. Egypt's GASC bought 175,000 tonnes of Russian and Ukrainian wheat via a tender for shipment September 21-30.
US soft red winter wheat prices were about $25 per tonne higher than the most competitive offers on a FOB basis. Heavy rain in Argentina's Pampas farm belt threatened about 8 percent of the country's wheat crop. Past Argentine wheat shortfalls have triggered Brazilian buying of US wheat. Gulf soybeans for September were offered 85 cents over CBOT November futures, which closed 17 cents higher at $9.27. September corn offers were 55 cents over the CBOT September contract, which closed 6-1/2 cents higher at $3.63-3/4 a bushel. FOB SRW wheat at the Gulf for September was offered at 55 cents over CBOT September futures, which closed 11 cents higher at $5.03-1/4.
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