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A fresh USDA export sales notice indicating a large volume of sales to China sent futures rallying Tuesday with the March contract up by close to 3% by time of press.
The note confirmed China had booked 1.36 million mt of corn from the US, amounting to 8% of the country’s 17.5 million mt imports as estimated by the USDA Wasde, and adding to the 11.7 million mt already booked in the 2020/21 marketing year.
March futures were trading at $5.25/bu by 1630 London time, up 4.7% from Friday’s close of $5.00/bu.
The parties involved in the purchase could not be confirmed according to sources spoken to by Agricensus, but a number of trading majors were reported to been involved in the sale with Cofco the likely buyer.
Shipment was likely for May and June laycans.
Some also said that, rather than being snapped up in one purchase, the volume had been bought in consignments over the past few weeks, with the full volume only declared to the USDA yesterday once total freight costs on a CFR basis had been booked to China.
The buying has registered in US values, with barge values – part of the key river supply network into the primary exporting hub of the US Gulf – rising for June shipment as a result, with some hearing CIF barge offers more than 10 c/bu above equivalent levels for export from the Gulf.
“This is business that was rumoured from two weeks ago that finally got announced. They did ask for offers of May/June US yesterday, but I did not hear if any was booked,” Charlie Sernatinger from ED&F Man told Agricensus.
This recent purchase echoes a bumper volume for the current 2020/21 marketing year done at the end of July when a single export sales notice reported that China purchased 1.93 million mt of corn, one of the biggest in history.